Inside Africa

6 min read

How to start a security company in South Africa

February 19, 2026

Are you thinking about how to start a security company in South Africa? We’re here to guide you through the essentials, making entry into the industry easier than you imagined.

South Africa’s security sector is among the largest and most dynamic in the world, driven by persistent high crime rates and a diversified demand for protective services across residential, commercial, and industrial sectors.

Estimates suggest the industry employs over 500,000 registered security officers and generates more than R50 billion annually, reflecting its scale and economic significance.

This article will help you grasp the opportunities and challenges on how to start a security company in South Africa.

Table of Contents

How to start a security company in South Africa

1. Regulatory framework

At the heart of the private security industry is the Private Security Industry Regulatory Authority (PSIRA), established under the Private Security Industry Regulation Act (Act No. 56 of 2001).

PSIRA’s mandate is to regulate private security providers to protect public and private interests and ensure professional standards and accountability throughout the sector.

What PSIRA does

Registers security businesses and individual security officers.
Sets training, conduct, and compliance standards.
Conducts inspections, audits, and enforcement actions.
Maintains public records of compliant entities.

PSIRA registration is non‑negotiable: operating without it is illegal and exposes owners and principals to prosecution and business closure

2. Pre‑registration steps

Before engaging with PSIRA, entrepreneurs must legally establish their business and meet multiple statutory obligations:

a. Register the company with CIPC

The first formal step is registering your business as a legal entity with the Companies and Intellectual Property Commission (CIPC). Most security firms adopt a Private Company (Pty) Ltd structure for limited liability and operational flexibility.

Required documents typically include:

Founding statement or Memorandum of Incorporation
Proof of registered address
Identity documents of directors and shareholders

b. Tax and employment registrations

Once incorporated, the company must register with the South African Revenue Service (SARS) for:

Income tax
Value‑added tax (VAT) (if applicable)
Pay‑as‑you‑earn (PAYE) for employee payroll

In parallel, registering with relevant labour authorities is mandatory:

Unemployment Insurance Fund (UIF)
Compensation for Occupational Injuries and Diseases (COID)

These registrations ensure compliance with South African labour law and eligibility for tenders.

c. Essential business infrastructure

PSIRA requires a fixed and immovable office address as part of the registration process. Mobile or virtual offices alone do not satisfy regulatory requirements.

As part of its inspection process, PSIRA will assess whether the location supports operational supervision, record‑keeping, and secure storage of sensitive documents.

3. PSIRA registration

Securing PSIRA registration is the cornerstone of launching a security company in South Africa. The process involves multiple documentation steps and compliance checks.

Who must register

Both the security business entity and individual principals (directors/managers) must be registered with PSIRA. Every director or person in a position of authority must hold at least a Grade B security status, which signifies competency for supervisory roles in security operations.

Key PSIRA requirements

To secure PSIRA approval, applicants must provide:

Proof of CIPC company registration
Tax Clearance Certificate from SARS
VAT and PAYE numbers
Registered UIF and COID references
Certified identity documents for directors
A business plan outlining operations for at least one year
Evidence of a physical office location
PSIRA‑accredited security training certificates (minimum Grade B for principals)

Directors must also pass background checks, be permanent residents or citizens, be at least 18 years old, and have no disqualifying criminal records.

Submission and evaluation

PSIRA applications can be submitted online via the PSIRA portal. Processing times frequently span several weeks, depending on the completeness of documentation and internal verification processes.

PSIRA conducts site inspections and grading assessments before issuing a registration certificate.

4. Costs of starting a security company

Setting realistic financial expectations is essential. While exact costs vary by business model and scale, industry data suggests startup costs fall within the R280,000 to R825,000 range for a basic operation.

Breakdown of typical expenses

Category	Estimated cost
PSIRA Registration & Regulatory Fees	R5,000 – R15,000+ (variable by category)
Office Setup	R15,000 – R50,000
Uniforms & Equipment	R20,000 – R80,000
Vehicle (if offering patrol/response)	R80,000 – R200,000
Insurance (Liability & Indemnity)	R20,000 – R80,000/year
Working Capital (Payroll, 2–3 months)	R100,000 – R300,000

Ongoing financial obligations

Annual PSIRA renewal fees
PAYE, UIF, COID contributions
Rent, utilities, and office overhead
Training and compliance updates
Tender compliance costs

In practice, cash flow management is a critical challenge. Many security companies pay staff weekly or bi‑weekly but receive client payments on 30–60‑day terms, necessitating robust working capital planning.

5. Training and human capital requirements

A significant differentiator in the security industry is personnel competency. PSIRA mandates structured training and grading for individuals serving in operational or supervisory roles.

Training grades

Grade E – Entry-level guarding
Grade D – General guarding duties
Grade C – Supervisory level
Grade B – Management level (required for principals)

Principals should invest in accredited training for themselves and key staff to support compliance and graded service delivery.

6. Market access and contracting

Regulatory compliance is a prerequisite to market entry, but growth is driven by commercial and government contracts. Security services extend across:

Residential estates and complexes
Corporate premises
Industrial facilities
Event security
Armed response
Cash‑in‑transit (CIT) and specialist services

Security tenders, particularly in the public sector, often require documented compliance, PSIRA certification, and, in many cases, Broad‑Based Black Economic Empowerment (B‑BBEE) status. Smaller firms with turnover under R10 million can qualify for a B‑BBEE affidavit, lowering barriers to government contracting.

7. Operational challenges and compliance

While demand for security services remains strong, operators face structural challenges:

Wage and labour regulations

The sector is governed by specific sectoral determinations that dictate minimum wages and labour conditions. Non‑compliance can result in penalties by the Department of Employment and Labour.

Competition and pricing pressure

Unregistered companies undercut prices, eating into margins and pressuring compliant operators to compete on price rather than service quality. Strategic pricing that accounts for wage, compliance, and operating costs is critical for sustainable profitability.

Enforcement and legal risk

Operating outside PSIRA compliance exposes businesses to enforcement actions, loss of contracts, and reputational risk. Clients increasingly verify PSIRA status prior to engagement.

Conclusion

Starting a security company in South Africa requires careful navigation of regulatory, financial, and operational requirements. Compliance with PSIRA and statutory registrations, realistic budgeting, structured training, and strategic market positioning form the foundation of a credible security business.

For prospective founders, success hinges on thorough preparation and institutional knowledge of the legal and market landscape. With the right framework in place, security companies can contribute meaningfully to public safety while building sustainable commercial enterprises.

Leave a comment and follow us on social media for more tips: