Co-operatives Development Fund Objectives
- To fund Co-operatives for expansion and sustainability;
- Acquiring and supplying of any product produced by the Co-operative
- The loans will be considered only for income generating assets for purpose of ensuring that the Co-operatives produce and supply goods and services;
Based on the capital required but not to exceed R500 000 per investment
- Purchase of shares from existing businesses;
- Debt financing;
- Plant relocation;
- Non income generating assets
- Financing of vehicles/automobiles for private use is explicitly excluded
- Property Development
Loan repayment terms
Interest Rate (Fluctuating)
- The interest rate charged will be based on the prevailing prime rate plus 1%.
- The grace period for payment will depend on the nature of a project, which in the case of a new business shall not exceed three months from date of the first disbursement.
- The interest charged during the grace period shall be capitalized.
- In the case of a existing business the grace period may not exceed one month from date of the first disbursement.
- No equity contribution shall be required for this loan products
A 100% security cover is desirable; however, a minimum cover of 60% will be considered, depending on the product and capital required. The Viability and risk of the venture will also be considered for purpose of determining the security cover.
The following fees and costs shall be payable by all applicants:
- Initiation fees equal to 2% or R2 500 plus VAT(whichever is lesser) of the approved loan amount exceeding R50 000.00, is payable before implementation and disbursement of the loan (this amount can be capitalised if requested by client).
- Security registration costs shall be borne by the client and may be capitalised.
- The borrower must cede comprehensive short-term business insurance to the FDC.