The role of fintech in financing SMMEs in the South African mining sector

Abstract

Small, micro, and medium enterprises (SMMEs) in South Africa’s mining sector face significant funding constraints due to remote operational locations, high capital demands, and fluctuating revenue flows. Guided by the Technology- Organisation-Environment (TOE) framework, this qualitative study investigated how financial technology (fintech) solutions could alleviate these financing challenges. Data were collected through semi-structured interviews with SMME owners, fintech providers, and industry consultants. The findings reveal that fintech platforms offer rapid loan approvals, flexible repayment terms, and reduced procedural burdens benefits particularly crucial for capital-intensive mining operations. However, adoption is hampered by limited internet connectivity, digital-literacy gaps, mistrust of new platforms, and regulatory complexities. Recommendations include improving infrastructure in remote areas, instituting targeted training and capacity-building programs, and clarifying fintech regulations to mitigate compliance risks. The study concludes that, while fintech holds substantial promise for enhancing financial access and operational efficiency in the mining sector, its full potential depends on concerted efforts by policymakers, service providers, and industry stakeholders to address contextual barriers and build a supportive ecosystem for digital finance.