n South African Journal of Economic and Management Sciences - Debt financing the capital requirements of South African informal market traders




This paper describes a case study that was undertaken to determine whether formal sector personal debt financing might contribute to the funding of South African informal market traders. The case study was conducted at the Natalspruit informal market in Ekhurhuleni, Gauteng. Quantitative questionnaire surveys and a financial diaries project established that market traders in the market have capital requirements large enough to justify the use of formal sector debt financing, can generate sufficient operating profits to pay for formal sector debt financing and would be willing to utilise formal sector debt financing if given the opportunity. However, formal sector debt financing is most relevant to those informal market traders with the skills and motivation to utilise financing effectively and who are willing to inject more formality into their businesses.


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