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Free State Development Corporation

General Enterprise Development Fund

Objectives Of The Fund

  • Increase participation of previously disadvantaged individuals (PDI) in areas of economy in which they are underrepresented.
  • Establishment of a significant manufacturing sector in the Province.
  • Development of agro-processing industry in the Province.
  • Development of the ICT and BPS&O industries.
  • Promote and encourage tourism development in the Province.
  • Diversification and Technology upgrading of existing manufacturers.
  • Financing of commercial vehicles (Light and medium trucks) including heavy duty trucks with semi-trailer configuration for transporting goods can be financed by the FDC.
  • Financing of plant, machinery and equipment including industrial equipment.

Financing Policy

Loan size

  • Based on the capital needs, above R50 000 and not exceeding R5 000 000-00 per investment.

Exclusions

  • Purchase of shares from existing businesses
  • Debt financing
  • Guarantees
  • Plant relocation
  • Non income generating assets
  • Financing of Vehicles/Automobiles for private use is explicitly excluded

Loan Repayment terms

  • 60 to 72 months maximum
  • Loans for property : Maximum 120 months

Interest Rate (Fluctuating)

  • The interest rate charged will be based on the prevailing prime rate plus 1%

Grace Period for Loan Payment

  • The grace period will depend on the nature of a project, which in the case of a new business shall not exceed six months from the date of the first disbursement.
  • The interest charged during the grace period shall be capitalized.
  • In case of an existing business the grace period shall not exceed three months.

Equity Contribution

  • An equity contribution is not required

Securities

  • A 100% security cover is desirable; however, a minimum cover of 80% may be considered depending on the product and capital required. Viability and risk of the venture should also be considered for purpose of determining the security cover.

Fees
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 amounts exceeding R50 000.00, is payable before implementation and disbursement of the loan. (To be capitalised if requested by client).
  • Security registration costs shall be borne by the client and may be capitalised.

Insurance
The borrower will be covered by FDC group scheme insurance for projects limited to maximum capital exposure covered by the FDC group credit scheme ( the premium to be included in the monthly instalment); or cession of own life cover policy on total exposure. Comprehensive insurance to be ceded to the FDC.

FDC Head Office

33 Kellner Street
Bloemfontein

Tel: 051 4000 800
Email: info@fdc.co.za

Fast Facts

  • Capital: Bloemfontein
  • Languages: 64.4% Sesotho
    Languages: 11.9% Afrikaans, 9.1% isiXhosa
  • Population density: 23 people per km²
  • Area 129, 480 km²
  • Share of total SA area 10.6%

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