The bleak picture of bank funding as Covid-19 purges small businesses

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Even before the pandemic, more than a quarter of small businesses relied on the so-called "soft loans" from informal lenders, family and friends before the lockdown.
Even before the pandemic, more than a quarter of small businesses relied on the so-called "soft loans" from informal lenders, family and friends before the lockdown.

The Finfind SA SMME Covid-19 Impact Report, published by the Banking Association of SA, shows that 42.7% of small, medium and micro-enterprises (SMMEs) might have closed last year.

The exact percentage of businesses that closed down might be slightly higher or lower, granted that the response rate was only 10%.

Still, with more than 250 000 points of data provided by those who responded, the report paints a picture of how the pandemic decimated smaller businesses – or, more appropriately, how lack of access to finance put the final nail on their coffins.

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