Initiatives to support small, medium, and micro enterprises to survive load shedding in KwaZulu-Natal, South Africa.

Abstract

Load shedding in South Africa severely disrupts SMMEs, many of which lack the financial capacity to invest in backup power solutions. This leads to business disruptions, financial losses, and even closures. As a result, jobs are lost, and the economy suffers, making it harder for small businesses to remain stable, grow, and contribute to long-term economic development. It is therefore crucial to explore the support mechanisms available to SMMEs during load shedding. The research is structured around three main objectives: (1) to determine the strategies and initiatives in place to help SMMEs cope with power outages, (2) to investigate the financial assistance provided by both the public and private sectors to alleviate the impact of load shedding on these businesses, and (3) to examine the factors that influence the decision-making processes of government and private sector institutions when it comes to financing SMMEs during such crises. Through semi-structured interviews conducted with four groups of participants: representatives from financial institutions, government agencies, industry experts, and SMME owners, the study identified several key findings. Initiatives such as information sharing and networking, capacity building and skills training, as well as stakeholder engagement and collaboration, have shown some success. However, their overall impact remains limited, as these initiatives often fail to address real-time operational challenges, particularly in rural areas. In terms of financial support, both the public and private sectors have introduced affordable and flexible financing options, along with specialized energy funds tailored for SMMEs. Despite these efforts, the uptake of these financial products has been relatively low. Key factors influencing financial decisions include business stability, growth potential, compliance, and South African ownership. The findings highlight the need for deeper trust and more tailored solutions to better meet SMMEs' needs.