Please take note of the different government and funding instruments available. One of our professional bodies (SAIT) has provided us with the list and details below.
- Agro-processing Support Scheme
- The objective of the APSS is to stimulate investment by South African Agro-processing/beneficiation (agri-business) enterprises.
- Administered by the DTI
- Maximum funding –R20 million per entity
- 20 to 30% grant on capital costs
- Qualifying Criteria
- Be a registered legal entity
- Possess a tax clearance certificate
- Be involved in starting a new Agro-processing operation or in expanding or upgrading an existing Agro-processing operation
- Submit a valid B-BBEE certificate (minimum level 4)
- Purchase 30% of supplies from black owned farmers
- https://www.thedti.gov.za/financial_assistance/financial_assistance.jsp
- Black Industrialist Scheme
- The Black Industrialist Scheme (BIS) incentive offers a grant on a cost sharing basis.
- Administered by the dti
- Maximum funding –R50 million per entity
- 30 to 50% on mainly capital costs –not acquisitions
- Qualifying Criteria
- Be a registered legal entity in South Africa
- Be aligned to the productive sectors of the economy within the identified sectors
- The applicant must have greater than fifty percent (>50%) shareholding and management control
- The applicant must be directly involved in the day-to-day running of the operation and must have requisite expertise in the sector.
- https://www.thedti.gov.za/financial_assistance/BIS.jsp
- Procurement from Government
- Government has prioritised securing essential goods and services from all critical stakeholders nationally
- https://www.dsbd.gov.za/wp-content/uploads/2020/03/Request-for-ProposalsNone-Food-Supplies.pdf
- The Department of Small Business Development (“DSBD”) is implementing measures to support small businesses that manufacture critical products such as hygiene, medical goods, food items and related support services businesses.
- Register on smmesa.gov.za
- The essential goods and services that have identified are required for the South African public including state owned hospitals, clinics, schools and essential place to
- Reduce the transmission of Covid 19
- Protect the health of the public, vulnerable members of the society and employees of health institutions
- Ensure that there is adequate of these products to pharmacies, hospitals and key sectors
- Qualifying small businesses are encouraged to submit proposals to the DBSD between 27 March 2020 and 30 April 2020 email to – criticalsuppliers@dsbd.gov.za
- IDC MCEP Loan COVID Essential Product Manufacturers
- Administered by the Industrial Development Corporation –from DTIC
- For working capital and plant & equipment requirements
- Fund Value –R300 million • Maximum funding –R30 million per entity
- Cost of finance
- Priced at a fixed rate of 2.5% per annum
- Maximum term is 48 months, including moratorium
- Qualifying Criteria
- Be a registered legal entity in South Africa
- Company that has been operational for at least a year
- Company must have a valid contract/purchase order or letter of intent
- Applicable to manufacturers of COVID-19 essential goods
- Companies with BBBEE Level 4 will be encouraged
- https://www.idc.co.za/2020/03/24/idc-interventions-in-response-to-covid-19/
- IDC COVID 19 FUND COVID Essential Product Manufacturers & Suppliers
- Administered by the Industrial Development Corporation
- Short term loan for once-off contract finance or import funding, revolving credit, guarantees for imports
- Cost of finance
- Loans priced at prime + 1 % per annum
- Guarantees 2% per annum
- Maximum term is 3months, including moratorium
- Qualifying Criteria
- Track record in manufacture or supply of comparable product –ability to deliver
- Company should show profitability prior to application
- Company to be registered as a vendor with Government, Multinationals or retailers
- Be a registered legal entity in South Africa
- Company that has been operational for at least a year
- Company must have a valid contract/purchase order or letter of intent
- Companies with BBBEE Level 4 will be encouraged
- Tourism Fund
- Administered by Department of Tourism
- Assist SMMEs in the tourism and hospitality sector who are under particular stress due to the Covid 19 travel restrictions.
- Fund Value –R200 million
- Maximum grant: unsure
- Qualifying Criteria
- Be a registered legal entity in South Africa
- Black owned entity
- Turnover not exceeding R2 500 000
- Proof of Tax compliance
- Proof of minimum wage compliance
- Proof of UIF registration for employees employed by the business
- Guarantee employment of staff for a minimum of three months
- Existence for at least one business financial year
- https://www.tourism.gov.za/AboutNDT/Ministry/News/Pages/COVID19_interventions_for_the_tourism_sector.aspx
- Debt Relief Finance Scheme
- Administered by Department of Small Business Development
- To benefit businesses that are negatively affected, directly or indirectly, due to the Coronavirus pandemic to mitigate against job losses and the expected harsh economic impact.
- Fund Value – R500 000 000
- Qualifying Criteria
- Registered with CIPC by at least 28 February 2020
- Company must be 100% owned by South African Citizens
- Employees must be 70% South Africans
- Priority will be given to businesses owned by Women, Youth and People with Disabilities
- Applicants must demonstrate direct link of impact or potential impact of Covid-19
- Complete online Application Form (to be released on Thursday, 02 April 2020)
- https://www.mybindu.org.za/
- Business Growth/Resilience Facility
- Administered by Department of Small Business Development
- For businesses geared to take advantage of supply opportunities resulting from the Coronavirus pandemic or shortage of goods in the local market.
- Fund Value –R500 000 000
- Qualifying Criteria
- Registered with CIPC by at least 28 February 2020
- Company must be 100% owned by South African Citizens
- Employees must be 70% South Africans
- Priority will be given to businesses owned by Women, Youth and People with Disabilities
- Applicants must demonstrate direct link of impact or potential impact of Covid-19
- Complete online Application Form (to be released on Thursday, 02 April 2020)
- NEF Loan
- Administered by the National Empowerment Fund
- R200million from the DTIC
- For black business to purchase machinery, raw materials and other items
- Fund Value – Loans between R500 000 – R10 000 000
- Cost of finance
- Offered at 0% interest in year 1 and fixed at 2.5% thereafter
- Qualifying Criteria
- Must produce hand sanitisers, disinfectants, hand soaps, facial masks, gloves, medical protective clothing and steel beds, maize meal, flour, beans, cooking oil among other items
- Must be registered supplier for retailers or institutions that have agreed to purchase the manufactured products
- Tax compliance and commercial viability is a pre-requisite
- https://www.nefcorp.co.za/covid-19-business-funding/
- COVID-19 SME FUND
- Administered by Business Partners (Rupert Foundation & Remgro)
- For working capital (Salaries, rent, HPs, Loan installments)
- Fund Size R900mil (R100mil for Sole Prop & Partnerships administered by PWC)
- Transaction Value – Loans between R250 000 – R1 000 000
- Cost of finance
- M1 –M12 0%, payment holiday for first 12 months, no early payment implications
- M12 -M60 Prime interest, no early payment implications
- Monthly disbursements
- Qualifying Criteria
- Feb 2019 AFS signed (non negotiable)
- Fully compliant entity
- Formal registered entity
- Ownership does not have to be SA Citizens
- Excludes: Direct agriculture, non-profit organisations, Underground mining, Onlending
- Auto Fund
- Fund Value –R6 Billion
- The guidelines have not yet been finalised
- SAFT – SA Future Trust
- Support to SMME employees at risk of losing their jobs or who will suffer loss of income due to COVID
- Fund Size: Openheimer R1bil relief fund
- Annual turnover below R25mil
- Trading for min 24 months
- Sustainable business on 29 February 2020
- 5year 0% interest free loan
- Must be an ABSA, FNB, Nedbank or Standard Bank client
REGISTRATION IS DIRECTLY WITH YOUR BANK
https://opp-gen.com/saft/#eligibility
Way forward
- New way of working for government and private sector –speed versus bureaucracy;
- Expect changes and new funds to be launched;
- Expect the rules to be unclear, even to people administering the programmes;
Kind regards
Team LEAD
