Faculty of Commerce, Law and Management (ETDs)

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    Challenges and opportunities faced by social entrepreneurs in Sekhukhune District Municipality, Limpopo
    (University of the Witwatersrand, Johannesburg, 2023) Moipane, Phasha Pharane
    Background: Social entrepreneurship is increasingly recognised as a powerful means to address pressing societal issues. However, a substantial gap exists in the literature regarding the challenges and opportunities faced by social entrepreneurs in the Sekhukhune District Municipality (SDM) in Limpopo. This study aims to fill this gap by investigating the specific hurdles and prospects encountered by social entrepreneurs within this geographically isolated context. Significance: Social entrepreneurs play a pivotal role in mitigating socio-economic challenges and fostering community development. Their contributions are especially significant in underserved areas like the SDM. Population and Sample Framework: Data for this study was collected through interviews, articles, reports, and websites. Out of 50 social entrepreneurs approached, 26 accepted to be interviewed, constituting the study's sample. Method of Data Collection and Analysis: Qualitative research methods were employed to conduct interviews with the 26 social entrepreneurs operating in the SDM of Limpopo Province, South Africa. The data collected was analysed to uncover the challenges and opportunities faced by these social entrepreneurs. Highlights of Results: The study's findings underscore the substantial obstacles faced by social entrepreneurs in this region, which include insufficient funding, restricted access to networks, and inadequate training. These challenges hinder their project financing and sustainability efforts. Conclusions and Recommendations: This study recommends expanding local economic development and municipal procurement policies to provide interest-free grants to emerging entrepreneurs in the region. Furthermore, it suggests that social entrepreneurs can overcome some of these challenges by harnessing support from customers and leveraging tender opportunities provided by the SDM and other entities
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    The role of digital technology in SME funding by Commercial Banks in South Africa
    (University of the Witwatersrand, Johannesburg, 2023) Chili, Philani; Manessah, Alagbaoso
    SMEs are the backbone of developing economies, playing an integral role in GDP growth and job creation. South Africa, inclusive of an informal sector, presents a wider SME market, which through adequate support, can contribute significantly to the economy. With the future growth of the economy and improved employment prospects majorly dependent on the contributions of the SME sector as avowed by the South African Government, the success of these constrained businesses is most important. SMEs in South Africa have an average age of five years, with lack of access to financing noted as one of the key inhibiting factors. Although the advent of technology has introduced new financial intermediation players, offering innovative products necessary to drive accessibility to financial services, optimising traditional banks’ larger resources could yield mass benefit. Unlocking the full funding potential of banks through modern technology is therefore critical to support the survive and thrive prospects of SMEs. This study endeavoured to understand existing relationships and the extent to which digital technology can be exploited to improve accessibility to bank funding by SMEs, using literature insights pertaining to information opacity and innovation challenges which stifle progressive SME lending. The study was underpinned by the Disruption Innovation Theory and Information Asymmetry Theory. Following a quantitative approach, structured survey questionnaire data collected from SMEs in South Africa was statistically analysed. SMEs that attempted (whether successfully or not) to obtain funding from traditional banks were of particular interest. Although innovation and technology adoption seemed to drive accessibility to bank funding whilst lack of engagement with innovation activities hindered it, both showed weak correlations and had no statistical significance. Intriguingly, ‘age of business’ showed a statistically significant correlation with accessibility to bank funding, a result that is pertinent to the survival factors of SMEs and warrants further exploration. Whilst SMEs provide a reliable proxy to improved SME lending by banks, it is imperative that perspectives of the banks are included in such a study to make a meaningful contribution to academic research aimed at unearthing relationships that start to edge closer to an optimal SME lending model. In the meantime, the onus lies with SMEs to minimise information opacity and improve fundability through technology as they navigate a somewhat rigid traditional bank system.
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    What funding model will foster SMME development in South Africa?
    (University of the Witswatersrand, Johannesburg, 2023) Pezisa, Sinesipo Qama
    Literature suggests that the Small, Medium and Micro Enterprise (SMME) sector is important to local economic development. SMMEs can alleviate the problem of unemployment while being efficient and flexible by serving segmented consumer markets. First, this study investigates whether SMMEs have been the key drivers of economic development in South Africa. Second, the role of Development Finance Institutions (DFIs) in the financing of SMMEs and their funding models. Finally, the research presents a case study of a small private financial institution, the Small Enterprise Foundation (SEF), a Micro Finance Institution (MFI) in South Africa and its significant contribution to the SMME sector and economic development. The study found that the SMME sector remains largely under-serviced by the traditional financial institutions and DFIs, due to the reluctance to grant loans as a result of the lack of knowledge on the borrowing behaviour of SMMES. The case study of the SEF also showed significant funding gaps experienced by microenterprises that receive funding from it. The study concludes by making recommendations that the role of DFIs needs to be enhanced by using a key governmental department such as the Department of Small Business Development (DSBD) to be a key coordinator of SMME programmes among DFIs such as the Industrial Development Corporation (IDC).