Sefa bridging finance

The small enterprise sector accounts for a great percentage of the gross domestic product in South Africa.This sector continues to drive the country’s employment numbers and drive the economy forward. At the heart of this robust contribution is the constant need for capital to precipitate this growth process. One entity making a difference in this regard is Small Enterprise Finance Agency (SEFA).

SEFA was established in 2012 out of a merger of South African Micro Apex Fund, Khula Enterprise Finance and small business activities of IDC. SEFA was established to contribute towards the survival and growth of SMMEs and contribute towards poverty alleviation and job creation.

The bridging loan from SEFA is a short-term loan given to enterprises to finance working capital needs which can be stock or operating overheads. This finance which comes with a repayment period of one year should be backed by some collateral such as sureties, cessions, etc.This loan is also only provided to businesses that have secured firm contracts from their clients and its only applicable in business to business transactions.

Requirements to qualify for this finance include being a South African citizen with valid South African identity documents, be legally constituted which includes being a sole trader with a fixed physical address, have the necessary contractual capacity. All business operations, including but not limited to projects, programs or enterprises, must be operated within South Africa, the enterprise must be compliant with generally accepted corporate governance practices appropriate to the client’s legal status, have a written proposal or business plan that meets the requirements of SEFA’s loan application criteria, demonstrate the character and ability to repay the loan, etc.

The application process is very simple, applicants should approach SEFAs nearest regional office for the initial basic assessment, the office will then assess the application forms and submit to a committee for a decision, the committee will then communicate the decision to the applicant and if approved, funds are then transferred to successful clients and post investment monitoring or mentorship is provided where applicable.

SEFA can be contacted on 0860007332.