Business owners are watching monetary policy closely after Reserve Bank Governor Lesetja Kganyago warned that inflation risks cannot be ignored.
Any further increase in interest rates would raise repayment costs for SMEs using overdrafts, vehicle finance, credit lines or property-backed facilities, placing additional strain on businesses already managing thin margins.
At the same time, Transnet Port Terminals is introducing a new fuel-related charge on containers from 1 May, raising concern that importers, wholesalers and manufacturers could face higher logistics costs. Those increases often move through supply chains quickly, eventually affecting retailers, service businesses and consumers through higher prices.
Kgaogelo Maphanga, founder of a Midrand-based electronics accessories importer, said smaller firms are especially vulnerable because they have less bargaining power.
“We already absorb shipping costs, warehousing charges and courier increases. When another charge is added at the port level, it does not remain there. It moves through the chain until it reaches the small business owner,” he said.
Maphanga said SMEs often face a painful choice between raising prices or sacrificing margins. “If you increase prices too much, customers reduce spending. If you absorb every cost increase, profitability disappears. Small businesses are constantly balancing those pressures.”
Red tape still weighs on SME growth
Beyond immediate cost pressures, many entrepreneurs say administrative delays and compliance burdens continue to undermine growth prospects. The IMF has previously highlighted licensing restrictions and regulatory inefficiencies as structural weaknesses that reduce competitiveness and make it harder for businesses to operate efficiently.
For SMEs, these issues can include delayed permits, municipal approvals, supplier onboarding requirements, tax administration complexities and tender compliance processes that consume time and money. Unlike larger corporations, small businesses often do not have dedicated legal or compliance teams to manage these demands.
Refilwe Matjila, who runs a packaging business in Johannesburg South, said bureaucracy can quietly damage small firms.
“You can lose weeks chasing approvals or trying to resolve paperwork instead of focusing on customers and sales. For a small business, time lost is revenue lost,” she said.
Economists advise that SMEs remain disciplined on cash flow, pricing, productivity and customer retention may still outperform despite the difficult environment.
But owners argue that resilience alone is not enough. Without stronger growth, lower operating costs and simpler regulation, 2026 could become a year where many SMEs focus not on scaling up, but on simply staying afloat.
