Source: Government of South Africa
The Deputy Minister of Finance, Ashor Sarupen, has emphasised the importance of governments, the private sector, development finance institutions, and multilateral partners working together to create an enabling environment for Micro, Small and Medium Enterprises (MSMEs) to succeed.
Addressing an official side event of South Africa’s Group of Twenty (G20) Presidency, Sarupen highlighted that MSMEs are the backbone of every economy – accounting for over 90% of businesses globally.
“The private sector plays a key role—not only in providing capital, but also in driving innovation and market access. Emerging partnerships with non-bank finance actors—such as equity, crowdfunding, and venture capital—are promising and must be scaled to close the MSME funding gap,” the Deputy Minister said on Monday in Johannesburg.
In South Africa, MSMEs represent 91% of formal businesses, provide 60% of jobs, and contribute up to 34% of Gross Domestic Product (GDP).
“Their impact is clear, and so is our responsibility to create an environment that enables their success. The informal sector also holds potential to address unemployment yet remains excluded from adequate support. It contributes 6% to GDP and 17% to employment but continues to struggle with growth and productivity,” Sarupen said.
He was addressing the Global SME Finance Forum – an official side event of the G20 Global Partnership for Financial Inclusion Working Group.
“In line with the G20/ Organisation for Economic Co-operation and Development (OECD) Principles on SME Financing, we must support diverse instruments, enhance transparency, improve financial literacy, and promote timely payments. Together, we can build ecosystems that are inclusive, sustainable, and future-ready,” he explained.
Inclusive financial sector
South Africa’s efforts include the National Treasury’s Financial Inclusion Policy, approved in 2023, which sets a framework to build a more inclusive financial sector.
It focuses on deepening inclusion for individuals, expanding access to MSMEs, and diversifying financial channels.