Home / World wide / South Africa launches ‘bounce back’ finance scheme – how to apply

South Africa launches ‘bounce back’ finance scheme – how to apply

The Nationa Treasury has announced the commencement of the Bounce Bank Suort Scheme aimed at roviding additiona funding to quaifying businesses in order to grow the South African economy and to faciitate job creation. The scheme was first signaed in Finance Minister Enoch Godongwanas Budget Seech in February. In a statement on Tuesday Treasury said the Scheme is exected to faciitate the recovery and bounce back of businesses beyond the Covid19 andemic ockdowns The scheme wi aso he those businesses recovering from the Juy 2021 civi unrest in KwaZuuNata and Gauteng as we as the current ongoing foodreated disaster.

In June 2020 the Covid19 oan Guarantee Scheme was estabished to he ease financia ressures exerienced by quaifying businesses negativey affected by ow economic activity foowing ockdown restrictions to reduce the sread of Covid19. The guarantee scheme formed art of a ackage of reguatory and direct suort measures which rovided significant financia suort and heed reserve many jobs and ket businesses afoat.The Bounce Back Suort Scheme benefits from essons earnt from the 2020 oan Guarantee Scheme to rovide for greater takeu incuding deveoment finance institutions (DFIs) and nonbank sma and medium enterrise (SME) finance roviders. The Bounce Back Suort Scheme comrises a oan guarantee mechanism of R15 biion and a smaer equity inked scheme which wi be faciitated by Nationa Treasury and DFIs. The smaer equity inked scheme wi be introduced ater in the year as a comementary too of R5 biion.

How to apply Accessing the Bounce Back Support Scheme loans will be accessible through participating banks. Access for DFIs and non-bank SME finance providers to the Bounce Back Support Scheme will be facilitated through participating banks and such participating banks will still have to perform due diligence in accordance with regulatory standards. Access to the equity-linked tool is expected to be introduced later this year and more details will be communicated once they are finalised Scheme loans are to be granted at a preferential capped rate repo plus 6.5 Government and lenders participating banks, DFIs and non-bank SME finance providers are sharing the risk of non-repayment of these loans with the government taking the first 20.5% of losses. The Treasury added that businesses will be required to repay the loan over a period of up to five years after any deferred interest period agreed to by the lenders. It said loans could have rescheduling options at the discretion of the lenders (pay as you grow), for up to a period of 10 years from the first drawdown in the event of businesses being initially unable to pay any repayment due.

About Husnain Ahmad

Check Also

Alexandra Daddario (‘The White Lotus’) video interview Kevin Jacobsen

Alexandra Daddario The White Lotus on being surprised by fan reactions to Rachels final decision …

Leave a Reply

Your email address will not be published.