CEDA exceeds repayment target by P116m
Pauline Dikuelo | Friday May 24, 2019 13:27
The historic achievement was revealed by Investment, Trade and Industry minister, Bogolo Kenewendo during the launch of Project Facilitation Fund this week.
Since its inception, CEDA has struggled to recover its loans from beneficiaries due to high project failure rates and general reluctance to repay amongst entrepreneurs. The Agency appears to have stepped up its loan recovery efforts, with a tougher stance against defaulters.
“For the first time in history, CEDA has been able to over-collect reaching P516 million,” she said. “We are taking a bit from the collections and putting it towards the pilot of the CEDA/LEA Project Facilitation Fund. “We are hoping as you continue to commit to paying CEDA back we can be able to offer more services to SMMEs.” The Project Facilitation Fund, which has been allocated P5 million, is a collaboration between CEDA and the Local Enterprise Authority (LEA).
It is meant to assist citizens with pre-project funding for high impact initiatives in the Small, Medium & Micro Enterprise (SMME) space on a grant-loan contributory basis. Beneficiaries will be expected to contribute 50% of the funding and loans between P5,000 and P50,000 will not exceed a 12-month repayment period.
Loans from P50,000 will not exceed 60 months repayment and a flat interest rate of five percent per annum will be charged on all loans. The Fund is available for startups, early stage investing, expansions, joint ventures, mergers and acquisitions as well as restructuring and turnarounds.
It will cover services including environmental impact assessment, product testing and process certification, due diligence and valuations, soil and water tests, borehole test pump report as well as structural reports.
“Priority will be given to agro processing, manufacturing and tourism, however, other sectors will be considered if they meet the high impact criteria.
“Applicants have to register with LEA, submit their proposals and follow all the steps until CEDA where they will be funded if successful,” Kenewendo said.