Support for SMEs Critical for Post COVID Economic Recovery
Old Mutual Insure concentrates resources where they matter most. By Garth Napier, MD of Old Mutual Insure
As Finance Minister Tito Mboweni grapples with the near-impossible task of balancing the country’s books following the economic devastation of COVID-19 lockdowns on an already ailing economy, Old Mutual Insure has identified practical steps that are making a positive difference to the survival and long-term growth of small and medium enterprises.
Progressing and protecting SMEs to advance economic recovery
The small and medium enterprise (SME) sector is key to the recovery of the South African post -COVID economy. SMEs are also the country’s biggest employer, offering the largest potential for both future growth and future employment.
Given the centrality of SMEs to South Africa’s economic future it is hoped that Minister Mboweni will include measures aimed at supporting their recovery in this year’s budget. As a responsible corporate citizen, Old Mutual Insure, is already playing its part by supporting the SME sector. Practical and relatively easily implemented SME-support measures that Old Mutual Insure has deployed in response to SME clients in crisis during the COVID-19 pandemic include:
- Targeted and informed financial assistance
During the initial COVID-19 lockdown, for example, Old Mutual Insure committed to pay all suppliers within seven days to support their cash flow and set aside R40 million to assist qualifying SME customers with interest-free loans, to help them remain solvent in these difficult times. By maintaining dialogue with the worst impacted SMEs after lockdown and through the subsequent lockdown, Old Mutual Insure has assisted 20 SMEs remain operational, directly keeping more than 300 people employed during lockdown through cashflow support.
- Payment holidays
Premium deferment, with a delayed pay-back over a set period, leniency on debit orders missed due to COVID-19, reduced premiums, allowing customers to amend cover temporarily and various premium relief packages worked well.
- Leveraging technology
Old Mutual Insure developed a raft of online capacities to support SMEs to operate in the new remote and digital work environments that evolved in response to lockdown. Ubi – standing for User Based Insurance, for example, is a fully operational bot designed by Old Mutual Insure enabling clients to use their phones to photograph their odometer readings, sending pics of individualised mileage via WhatsApp to Ubi each month.