Over 130 000 SMEs apply for Covid-19 cushioning

Dumisani Nsingo, Senior Business Reporter
MORE than 130 000 Small and Medium Enterprises (SMEs) and players in the informal sector have applied to benefit from Government’s funding facility aimed at cushioning them from the adverse impact of the national lockdown period.

Women, Community, Small and Medium Enterprises Development Minister Dr Sithembiso Nyoni said applications for funding under Government’s facility to assist people engaged in SMEs and informal sector was overwhelming.

“The uptake for the cushion facility was very good and as Government we are very satisfied about it. We registered over 130 000 who will start benefiting from the facility soon. We also received an appeal that there is still a great number of people that are interested in registering for this facility and as such we will look at it as Government and might consider re-opening the facility for such applicants,” she said.

Dr Nyoni said her ministry was going to use the facility to update its database as it seeks to ensure the formalisation of players in the SMEs and informal sector to enable them to contribute effectively to the country’s economy.

“As a ministry the registering or applications by these SMEs and players in the informal sector will also enable us to update our records and come up with comprehensive data detailing the number of players in this sector.

“We intend to know the numbers of the players in this sector so as to consider them for a number of programmes we intend to roll out in the near future as well as assessing their contribution to the country’s economy,” she said.

In 2017, Government approved the formalisation of SMEs at a time when Zim­babwe’s tax base started shrink­ing as com­pa­nies either down­sized or closed shop, with the SMEs sec­tor tak­ing over as the coun­try’s big­gest em­ployer.

SMEs reg­is­tered for in­come tax pur­poses with Zimra are el­i­gi­ble for ap­pli­ca­ble de­duc­tions pro­vided for in the In­come Tax Act in re­spect of ex­pen­di­ture re­lated to their op­er­a­tions.

Last year about 16 000 SMEs registered to formalise operations of their businesses with the Zimra raking about $60 million from the new registrants in the process. Matabeleland North Provincial Social Welfare Officer Mr Mcnon Chirinzepi confirmed that the lists with names of SMEs and informal sector players from all provinces drawn from their various associations had been submitted to the Ministry of Public Services, Labour and Social Welfare.

“The lists of all eligible SMEs and informal traders from all the Provinces have been submitted to the head office (Ministry of Public Service, Labour and Social Welfare). Treasury is still processing the funds but at the moment disbursement of funds for vulnerable households has begun,” he said.

Contacted for a comment Ministry of Women Affairs, Community, Small and Medium Enterprises Development Mashonaland West provincial development officer Mr Patrick Rangwai confirmed that over 20 000 people from his area of jurisdiction applied for the facility.

“As a province we received 23 315 applications and out of those applicants, 9 705 were men and 13 610 were women. When the programme was unveiled, our ministry relayed the information to SMEs associations meaning to say, the people that were applying were coming from various associations. We also got names from people who were not bone fide with any association,” he said.

However, Small and Medium Enterprises Association of Zimbabwe executive director Mr Farai Mutambanengwe said the number of people that applied for the cushioning facility was low largely due to lack of information about the fund. He also noted that other players are likely not to have applied due to the fact that they are not registered with any association.

“The figure is very low but probably it’s because of lack of information and failure to access registration points.

“The relevant ministries have been working through associations, so if one is not a member of such, it becomes difficult to reach out to them because they are not registered or known to exist by anyone formal. Therefore, there is a need for all players in the informal sector to ensure they are registered with an accredited association,” said Mr Mutambanengwe.
@DNsingo