KUGOMPO CITY - Where is the R500 million spaza support fund?
As public outrage simmers over foreign-owned spaza shops that do not comply with safety regulations, questions have once again been raised over government's slow-moving pace in the disbursement of the R500 million spaza shop fund.
The fund, announced by President Cyril Ramaphosa in November 2024, was officially launched in April 2025 by Minister of Trade, Industry and Competition, Parks Tau and the Minister of Small Business Development, Stella Ndabeni.
But over a year later, only R179.6 million has been disbursed across all nine provinces.
The departments of Small Business and Trade, Industry and Competition say they have received 4,522 complete applications nationally. About 4,240 applications have been assessed and only 2,369 approved for support.
“The assessment process continues to highlight a key structural constraint within the sector, with only 58% of applicants linked to valid business licences or temporary permits issued by municipalities.
“As a result, a significant number of applications remain unable to progress until licensing and compliance requirements have been addressed,” the departments said in a joint statement.
Ndabeni visited KuGompo City on Thursday, where she was part of a delegation that hosted a Small Business Clinic. She told eNCA that of the 1,500 spaza shops in Buffalo City Metro, only 210 were owned by South Africans.
When quizzed about the support fund, the minister said much of the focus was not only on spaza shops, but also on other businesses that need funding.
When asked how her department was closing the gap in helping South Africans reclaim the spaza shops economy, Ndabeni simply responded, "I cannot close the gap".
"Businesses are operated by the owners and supported by the customers. All we can do is to support an existing business. More support talks to training and funding where necessary, including funding towards compliance."
Ndabeni's visit comes as communities in the Buffalo City Metro went up in arms this week, calling for the permanent closure of foreign-owned spaza shops, saying they do not comply with safety regulations.
The residents alleged that children have bought contaminated food items from these shops.
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This follows two incidents of alleged contaminated food items that sparked outrage in the communities of Mdantsane and Bhongweni.
A child from Better Life in Mdantsane died after allegedly eating a lollipop bought from a foreign-owned spaza shop, while in Bhongweni, residents have forcefully shut down spaza shops after they discovered unknown pills inside a packet of chips.
This has also prompted a response from health and safety officials in the Buffalo City Metro to check if the owners of shops were complying with the necessary permits and regulations.
Mesgana Egedo, a foreign national spaza-shop owner, refuted the claims, saying they were simply trying to earn an honest living.
"I don't know why we are being framed. We are doing good things for the community. We don't go selling drugs or contaminated products," Egedo said.