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 four products: Project Finance, Business Acquisition, Expansion Capital and Start-up/Greenfields with the funding threshold ranging from a minimum of R1 million to R50 million.
Sectors to be funded:
- Primary and Secondary Agriculture
- Agro Processing
- Manufacturing
- Tourism
- Agro Forestry
- Retail Property Development
- Aqua and Marine Culture
- Small Scale Mining
- Renewal Energy
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: