Rural and Community Development Fund
Rural and Community Development Fund was designed to promote sustainable change in social and economic relations and supporting the goals of growth and development in the rural economy, through financing of sustainable enterprises. This would be achieved through the mobilisation of rural communities in legal entities or cooperatives, in order to participate in the broader economic activities and realise the economic transformation goals in rural South Africa. The fund has three products: Acquisition Finance, Expansion Capital and Project Finance (New Venture/Start-up/Greenfields) with the funding threshold ranging from a minimum of R1 million to R50 million.
Sectors funded:
- Agro Processing and Manufacturing
- Eco-Tourism
- Forestry and Fisheries
- Commercial Property
- Aqua and Marine Culture
- Non - Farm Activities (rural based)
The key criteria of this product are:
- Projects must be financially sustainable
- BEE applicants should be actively involved in the day-to-day operations of the business
- Technical partners should be actively involved in the day-to-day operations of the business
- The NEF will invest using debt, equity and quasi-equity instruments
- Minimum black ownership of 25.1% is a requirement
- Joint ventures between black and non-black partners to support skills transfer
- The business should be able to repay NEF’s investment
- The business must have a clear value-add with a sustainable business case
- The NEF will exit from the investment in 5 to 10 years
- The NEF reserves the right to oblige applicants to participate in the NEF mentorship programme
Rural and Community Development Fund offers the following financing products:
1. Acquisition
This product was designed to cater for rural entrepreneurs or communities seeking to buy equity in existing rural and community enterprises focusing on small to large ventures where partnerships between NEF, BEE parties or community entity and technical partner is involved.
2. New Venture Capital
New Venture Capital product is aimed at assisting rural entrepreneurs and co-operatives and communities with equity contribution towards establishment of sustainable new ventures in Agri-sector including forestry, tourism, processing, etc.
Medium sized new venture projects with total funding requirements of between R1m and R50m.
3. Expansion Capital
This product facilitates involvement and ownership by communities in projects promoting social upliftment of rural and community projects using entities such as co-operatives and private companies.
NEF offers non-financial support. Click here to find out more
How to apply for funding: click here
Source: www.nefcorp.co.za
National Empowerment Fund (Owner)
