In developed countries, SMEs have historically played a vital role in creating jobs, spurring innovations and creating new products, and thus contributed to economic growth (Kim, 2011). South Africa, as a developing country, should not overlook the importance of promoting, nurturing and supporting small businesses. In South Africa five out of seven new small businesses will fail within their first year of operation (Entrepreneur, 2014). It can therefore be seen that these small businesses experience challenges that limit their success. The purpose of this study was to establish the business constraints experienced by SMEs in South Africa. The study found that the main constraint that SMEs encountered is the lack of financial support. The findings showed that only 56.9 per cent of the respondents had received financial support from banks by means of a loan. Only 1.7 per cent of the respondents indicated that they received financial support from government.
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