South Africa Spent R36 Billion On Small Business Loans, Yet Unemployment Continues To Rise

South Africa has channelled R36 billion into small business loans over the past decade, yet the country’s unemployment rate has surged by 8% during the same period.

COSATU parliamentary coordinator Matthew Parks expressed concern that the investment has not produced the desired results in job creation or economic growth.

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“Given the high levels of unemployment, slow levels of employment growth, the difficulty of many people accessing capital, it’s not enough,” said Parks.

“Yes, not all of it can come from the state; the private banks have to provide the majority, but it’s really not enough. We are not making an impact in the way we desperately need to.”

Investment Alone Not Enough to Drive Job Growth

Parks highlighted that while funding plays a critical role, access to capital alone cannot sustain small businesses or ensure their success. He stressed the need for a broader approach that includes training, mentorship, and operational support.

“We’ve got to do much more. It’s about capital but also giving support, training, planning for businesses, access to markets, and addressing issues like crime,” he said. “We have to be much more bold and aggressive in how we put in measures for their success.”

Calls for a Stronger, More Inclusive Support System

COSATU has long advocated for a comprehensive small business development strategy that tackles structural barriers and boosts entrepreneurship. Parks’ comments come amid growing concerns that South Africa’s current efforts are failing to generate the large-scale employment urgently needed.

With unemployment remaining one of the nation’s most pressing challenges, Parks insists that both government and private institutions must collaborate more effectively to foster sustainable business growth and job creation.

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