An Assessment of Access to Financial Management Services by Small, Medium, and Micro Enterprises in Thohoyandou Business Centre

SMMEs, as vehicles of growth, innovation and social transformation, are important businesses which must be nurtured and harnessed by the South African authorities to enable them to quickly and effectively adapt to the challenges of globalization thereby benefiting the economy. The importance of SMMEs to the South African economy has already been acknowledged by government. Despite the growth in venture capital funding, access to funding remains a problem for small enterprises, in particular for empowerment groups in South Africa. In most surveys among small enterprises, the provision of concessionary finance comes out as one of the most urgently felt needs. Yet, extensive research reveals that access financing is one of the several important factors that are critical for business survival and growth, the other factors are market access and lack of financial management skills. South Africa’s financial sector has always been reluctant to provide comprehensive services for the fragmented, risk-prone and geographically dispersed small enterprises sector. One of the major hurdles that face entrepreneurship endeavours is the shortage of financial management skills. South Africa has a grim picture of the skills gap. SMMEs become the hardest hit as the entire commerce sector forages for the scarcest skills. Small enterprises have been victims of the instance of developing their employees only to lose them to bigger firms offering more lucrative incentives. As a point in case, SMMEs in South Africa’s expanding construction sector are losing the fight in the battle for scarce skills. Therefore, this study made an assessment on access to financial management services by SMMEs in Thohoyandou Business Centre, as this has a bearing on the economic development and sustainability of SMMEs. The research wanted to establish if the SMMEs in Thohoyandou Business Centre had access to financial management services support and, if they have, are the SMMEs ready to receive these financial management services?