Time to tap into S.A's informal sector


Social capital and mentorship is key to stimulating growth in the informal sector, this is according to Matsi Modise, Managing Director at SiMODiSA.

SiMODiSA is an industry association that seeks to accelerate entrepreneurship by collaborating with policymakers to enhance the success rate of high-impact, high-growth entrepreneurs.

Modise added that there was a need to tap into the potential that exists in the informal sector. She lamented the current economic matrix.


“We are getting a little bit impatient in terms of transforming the economy to ensure the majority of people in this country participate in the formal economy,” she said.

“Currently the majority is still a minority as far as participation in the mainstream sectors of the mainstream economy is concerned in South Africa.”

Modise said there was also a need to teach the right skills, create enabling ecosystems and social capital that is much needed in the townships environment.

“What you find in Sandton is not what you find in Alexandra though the two areas are five minutes apart. There is a clear disparity in South Africa and in our economy. We need to develop talent, skills, building business; this requires investment as it is good for the country and the economy.”

She said due to social background that people come from most people tended to take for granted other experiences from some demographic groups.

“You take a lot for granted when you have lived a privileged middle class to an upper middle class life,” she said.

“When you go to the townships you realise that what you take for granted is what they don’t know. The social capital attached on that is you are someone exposed to people who know about investment and free markets.”