Getting compliant for funding is an essential step
In the wake of the global economic crisis, which already loomed before the outbreak of the pandemic, as well as the exacerbating economic effects of the pandemic, multiple efforts are being made to provide enabling tools and resources to small businesses.
One such area of concern has been the issue of working from home. A purported 85% of businesses in South Africa, have opted to enable, encourage, or even instruct large complements of their teams to work from home, even during the easing of the lockdown regulations.
With regard to tools that enable the remote working arrangements, useful publications, such as Techjockey’s Software Guide, have been released to enable sound decision-making regarding the appropriate online tools to use for the home-working arrangement. This is a potentially costly exercise where organisations had no prior need to equip all staff, or large complements thereof, with the necessary software to facilitate efficient meetings, other work-related events, and fulfilment of deliverables.
Surviving small businesses, already operating on tight purse-strings, are facing a particular challenge in this area. If the extremely difficult hurdle of having to lay-off some of their staff members has been passed, the next hurdle – includes accessing and managing finances to keep operations afloat under new working arrangements. This would include ensuring operational efficiency from home.
Between 5 and 10% of the SMMEs sampled for C4G’s recently published inaugural White Paper, The Impact of Covid-19 On African SMMEs Operations: Insights From Entrepreneurs and Business Development Service (BDS) Providers In South Africa, indicated that access to funding is an option they would definitely need to explore as part of their mitigation strategy.
Business funding in South Africa is largely accessed through: Government institutions such as the DTI, NYDA and SEFA; Banks and Private investment companies as well as; Corporate ESD programmes such as those of SAB Foundation amongst others. Many have resorted to crowdfunding, in the absences of friendly funding options amongst the regular avenues.
Business development support institutions are not funders but often, obtain funding to support small businesses from start-up stages and through varying levels of maturity. The programmes offered through such organisations are greatly beneficial to the SME environment, more so now than ever.
Amongst these are the South African Institute of Chartered Accountants (SAICA) Enterprise development arm, led by MS. Annie McWalter, who offer, through support to SMMEs with regards to compliance, amongst many things.
Businesses need to be aware that while funding is accessible through the various standard and COVID-19 relief vehicles that have been established, compliance is the key enabler or obstacle when it comes to accessing these funds and businesses need to have their ducks in a row with regards to the documentation, systems and processes that they need to have in place in order to be able to submit favourable funding applications. Depending on the stage of a business, the type of funder and the kind of funding being sourced, these may include any of the following:
- Tax clearance
- Personal and company identification/registration documents
- Bank statements
- Valid proof of address/lease evidence
- Business plans and budgets
- Business financial statements
- Cash-flow forecasts
Businesses would do well to research the funding options and prepare the relevant compliance documentation, in order to increase their chances of accessing funding at this time when funding is most needed.