Page 7 - KZN Business Sense 7.1

STIMULATING JOB-RICH INDUSTRIALISATION

THROUGH AFFORDABLE FUNDING

at Moodley, IDC’s KwaZulu- worked with government lending, but rather considers
Natal (KZN) Regional and other DFIs in assisting the viability of the business and
PManager, says, “This year businesses to recover and cash flows to service their loan
the Industrial Development provide funding packages that repayments. The corporation
Corporation (IDC) celebrates will stimulate the economy,” however takes security for loans
80 years of existence in its role says Moodley. “We have a range disbursed and is open to crowd
as a Development Funding of funds and interventions funding with other financial
Institution (DFI), providing in place to address Covid-19 institutions as a way to share the
funding for manufacturing. We related funding requirements, risk on transactions.
have come a long way in aiding the including assisting companies
development of the South African that have capacity to acquire “Our first consideration is
economy during this time and and/or manufacture products the economic merit of each
have also assisted many companies needed to treat, curtail and business; meaning it has to be
in expanding and trading into the combat the spread of the sustainable, viable and profitable.
African continent.” pandemic,” says Moodley. To get In our application process, we
a full list of essential supplies go through what we call an
The IDC’s key sectors in the that can be funded visit initial assessment to see that the
province include the textiles, application meets all the basic
clothing, and footwear industry, https://www.idc.co.za/wp- criteria and mandate of the IDC.
content/uploads/2020/03/ IDC-
which Moodley says is a key Once that stage is passed, we go
driver in the KZN economy, Essential-Supplies-Funding- into what we call a due diligence
Intervention- COVID-192.pdf
especially because of easy process which is a comprehensive
access to the Durban port for Other interventions offered by assessment of the business
exports. Other economic sectors the corporation include general including management, technical,
supported in this region include distress funding, which is financial, and marketing
agro-processing, chemicals, available to businesses, provided capacity,” explains Moodley.
plastics and medical products, they have a clear turnaround
wood and furniture products, strategy. In addition to this, there The IDC is a responsible lender
automotive and transportation, is the Small Business Distressed and looks at compliance in all
machinery and equipment, Fund for SMEs with a trading areas such as taxation, labour,
electronics, basic metals, tourism, history of more than 12 months health and safety, as well as Pat Moodley, Regional Manager, Industrial Development Corporation (IDC)
infrastructure, as well as energy. and this fund is also available environment. Of importance
“With industrialisation comes for emerging enterprises with is ensuring that all necessary
development, which includes a turnover of less than R50 documentation and returns – its service to clients. To reduce pipeline in KwaZulu-Natal. I
the number of touch points,
think that there is a positive
job creation and localisation. million per annum (minimum including financial statements, the regional offices now handle outlook for the province. I
An additional element which loan amount of R1 million to a tax certificates, labour returns, funding proposals up to R15 remain positive that as lockdown
we actively focus on is the maximum R15 million). etc. are up to date. million, proposals over these restrictions are eased, there will
growth and empowerment of “We always advise clients or
“At prime less 3% this is
black industrialists, and youth an attractive interest rate. entrepreneurs to be transparent amounts are immediately referred be a greater number of requests
to the relevant business unit at
for more funding and we can
and women owned businesses,” with us as our due diligence
explained Moodley. The important thing is that head office for further processing. get the economy going again,”
businesses need to have a very process will unpack any non- This process means that the client concluded Moodley. 
Much of the investment in clear turnaround plan over the compliance,” advised Moodley. deals with the relevant person
the province is focused on next 12 to 24 months and must “Be realistic, remember you are from day one, significantly www.idc.co.za
stimulating localisation, with a have been in a healthy financial projecting turnover, so you have reducing the turnaround time
view to replace imports. As an position before Covid-19 started. to be able to quantify revenue for applications.
example, in terms of government The repayment term for this streams and ensure that these are If a project does not meet
policy, a certain percentage of loan is 60 months,” explained achievable,” he adds.
vehicle manufacturing must Moodley. “There are a sizeable The IDC has an online portal the IDC mandate it can be
referred to a different funding
include using locally produced number of small businesses in for applications. The KZN institute. “Our responsibility
components. The IDC has assisted KwaZulu-Natal that have the regional office is open Monday as a development finance
a number of first and second tier opportunity to access funding to Friday and staff are available institution is to assist clients. If
vehicle component manufacturers at competitive rates, however, to attend to enquiries or SCAN
in this regard so that they can sustainability is key,” he adds. applications. “I suggest clients we can’t assist in line with our QR CODE
mandate, we will pass clients
become globally competitive.
Responsible Lending make an appointment, come sit on to other relevant DFIs. We TO SEE
Covid-19 interventions The main difference between with us and pitch their business are always there to ensure VIDEO
proposals,” said Moodley.
“The onset of Covid-19 has the IDC’s and other financial that the client gets the right
information,” adds Moodley.
negatively impacted businesses, institution’s approaches to During the Covid-19 lockdown, (Open the camera on your phone and
not just locally, but on a global funding is that the corporation the IDC went through a “We have some sizeable hover steadily for 2-3 seconds over the
scale. As the IDC, we have does not practice security-based realignment process to streamline applications currently in our QR Code to see the video.)

7