R57m Spaza Shop Fund: Committee says no payments went to foreign-owned shops

The R57 million Spaza Shop Support Fund has successfully reached its intended beneficiaries, according to the Portfolio Committee on Small Business Development. As of July 31, 2026, a total of 930 disbursements had been made, with no single payment going to a spaza shop owned by a foreign national. Committee Chairperson Masefako Dikgale commended the department's stringent internal controls and due diligence measures, which ensure funds go to qualifying South African citizens operating legitimate spaza shops.

Dikgale clarified that applications are subjected to rigorous verification processes to prevent disbursements to spaza shops operated by foreigners through South African fronts. The committee's concerns arose after the Public Protector issued a Section 7(9) notice in July 2026, following an investigation into food-safety regulation and enforcement at spaza shops and other informal food businesses in Gauteng.

This investigation identified cases of business fronting, beneficiary mismatches, fraud, and misrepresentation, leading to allegations that some funding may have reached spaza shops operated by foreign nationals. The department assured the committee that its internal due diligence processes successfully identified and flagged fraudulent applications before payment, ensuring no financial disbursements were made for these fraudulent applications.

The committee remains vigilant in its parliamentary oversight to ensure the fund achieves its objectives, encouraging citizens and small-business stakeholders to report any suspected fraud, fronting, or misrepresentation through appropriate channels.