Blended Financing Scheme (BFS)
Whether you are planning to develop new capabilities, create new products or expand your business footprint overseas, having access to the right financing is crucial to realise your growth ambitions.
With effect from 29 Oct 2019, Local Enterprise and Association Development (LEAD)’s existing financing schemes will be streamlined into one umbrella scheme known as the Blended Financing Scheme (BFS). BFS will enable South Africa enterprises to access financing more readily throughout their various stages of growth.
It covers seven areas to address enterprises’ financing needs. LEAD will share the loan default risk in the event of enterprise insolvency with the Participating Financial Institutions.
- Enterprise Working Capital Loan
Finance daily operational cashflow needs.
- Enterprise Fixed Assets Loan
Finance the investment of domestic and overseas fixed assets including:
- Purchase of equipment and machines for automation and upgrading, include new or resale assets
- Construction or purchase of government and commercial built factories and business premises, include new or resale assets
Finance green growth projects.
BFS-Green enables better access to green financing for enterprises that are Project Developers, System Integrators and Technology & Solution Enablers which develop enabling technologies and solutions to reduce waste, resource use or greenhouse gas emissions, especially in sectors of Clean Energy, Circular Economy, Green Infrastructure and Clean Transportation. This is part of the Enterprise Sustainability Programme.
- Venture Debt Loan
Finance the growth of innovative enterprises using Venture Debt and Warrants.
Venture Debt Loan supports high growth enterprises that do not have significant assets to be used as collateral under traditional bank lending. Under the enhanced programme, the venture debt facility can be backed by warrants or redeemable convertible preference shares.
Enterprises may use the Loan to:
- Grow and expand existing capacity
- Diversify into other product lines
- Augment working capital needs
- Undertake new projects
- Undergo merger and acquisitions
- Trade Loan
Finance trade needs including:
- Inventory / stock financing
- Structured pre-delivery working capital (revolving working capital)
- Factoring (with recourse) / bill of invoice / AR discounting
- Overseas working capital loan
- Bank Guarantee (capped at 2 years tenure)
BFS Trade Loan covers enterprises’ domestic and overseas transactions.
- Project Loan
Finance the fulfillment of secured local and overseas projects.
The supportable loan types include:
- Working Capital Loan
- Factory/ Building/ Land (includes Purchase/ Renovation/ Construction)
- Equipment/ Machineries/ Vessels/ Other Fixed Assets/ Machinery Hire Purchase
- Mergers & Acquisitions Loan
Finance the acquisition of local or overseas target enterprises.
This supports enterprises to scale and expand through M&A – including venturing into complementary businesses and emerging sectors.
More information on the schemes and qualifying criteria can be requested by emailing us.