Barriers to Entrepreneurship Among Social Grant Recipients: A Case Study of Mthatha

Abstract

In South Africa, social grants assist approximately 18 million individuals; nonetheless, numerous beneficiaries remain ensnared in poverty due to obstacles that hinder entrepreneurial advancement. This study investigated the obstacles hindering social grant applicants in Mthatha, Eastern Cape from achieving sustainable entrepreneurship and evaluated the local government's role in mitigating these issues. A qualitative technique was employed, involving semi-structured interviews with 20 informal entrepreneurs, and the material was examined thematically. Results indicated enduring financial, institutional, and socio-economic obstacles, with more than 75% of participants identifying insufficient capital and 65% acknowledging criminality and extortion as significant impediments. The majority of participants received no municipal support, training, or business aid, necessitating ongoing dependence on funds despite their entrepreneurial endeavours. The study indicates that minimal government involvement, insufficient safety measures, and fragile institutional frameworks sustain reliance and hinder local economic development. Enhancing local government interventions, inclusive funding methods, and safety activities could improve business viability and diminish long-term dependence on social assistance in Mthatha.

Keywords: {'name': 'Capital, Entrepreneurship, local government, poverty, social grant, South Africa.'}

Authors & affiliations

Behluli Lucwaba
Walter Sisulu University

Nomanyano Primrose Mnyaka-Rulwa
Walter Sisulu University

Maxhobandile Ndamase
Walter Sisulu University

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