SEFA Guide For SMEs

SEFA Guide For SMEs


In the past businesses seeking funding were at the mercy of banks, investors or waiting in line for government funding. But as of April 2012, SEFA, the Small Enterprise Finance Agency, launched, providing hope for aspirant entrepreneurs all over the country. Here’s what SEFA does and how.

About SEFA

SEFA is the Small Enterprise Finance Agency established in April 2012 when South African Micro Apex Fund (SAMAF), Khula Enterprise Finance and business activities of the Industrial Development Corporation (IDC) merged.

The purpose of SEFA is to respond to and meet the financial challenges faced by small and start-up businesses by providing and facilitating access to finance.

Related: SEFA Funding

SEFA services are primarily targeted to survivalist, micro, small and medium business enterprises and co-operatives that need development to contribute to the economy and employment.

As of April 2013, SEFA plans to distribute R737 million to more than 15 000 small (but mostly micro) businesses by the end of the 1013/14 financial year – helping to create 18 000 jobs.

The organisation lends small businesses amounts ranging from R500 to R3 million in three main ways: Straight to the business owner, via retail finance intermediaries, and through banks using credit guarantee schemes such as Khula.


History of SEFA

The merger was initially brought to public attention when it was announced by the President in the State of the Nation Address in February 2011; leading to the establishment and launch of SEFA in April 2012.

What sets SEFA apart from its predecessors – SAMAF and Khula – is that where they only fund SMES through banks and other intermediary institutions, SEFA provides cash directly to entrepreneurs wanting to either start a business or expand an existing one.

This is an important breakthrough for small businesses previously denied finance for their business by banks because of inherent default risk.

Mandate of SEFA

The mandate for SEFA is to develop sustainable survivalist, micro, small and medium enterprises and co-operatives with the intention of improving local economies and providing job opportunities.

Related: National Youth Development Agency (NYDA) Funding


How SEFA hopes to help SME business in South Africa

Over the next five years (from 2013), it aims to have doubled the number of businesses financed to 34 000 small businesses, doubled lending to R1,6 billion.

Finance will be available to micro, small and medium enterprises and co-operatives through bridging finance, revolving loans, asset finance, working capital and term loans.

The agency also plans to  investigate partnering with retail chain stores and government feeding schemes in order to expand more effectively into rural areas; improve pre-loan support programmes  in partnership with Small Enterprise Development Agency (SEDA) to improve uptake of its credit guarantee scheme; partnering with provincial development finance agencies; and expand its pilot project in partnership with the SA Institute of Chartered Accountants (SAICA) that trains young graduates how to assist small businesses.

Are you looking for Government Funding? Have a look through our Government Funding guide.

It also plans to roll out another nine branches per year, co-located within SEDA or IDC branch offices.

Related: Attention Black Entrepreneurs: Start-Up Funding From Government Grants & Funds

Contact SEFA

Any small business with a viable business plan can apply for a loan. SEFA will evaluate the business to determine whether it will be able to afford funding, what it will be able to repay, and over what period of time without negatively impacting cash flow.

Visit for more information.

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  • nt

    I registered a busines in 2008 and kept the business account active by depositing 100 rand per month though I would withdraw it back on a monthly basis. I want to manufacture through sewing, I got buy in from spar and ok. But I dont have funding to make barcodes which cost 5000 rand and I want to buy an industrial machine which cost 8000 and employ 1 woman to help me with production, per day I can produce 40 items. How do I go about getting financial assistance my email address is

    • Morgan

      Hi Ntombi what exactly do you want produce If I may ask?