Frequently asked questions

Can you benefit from the EIB Southern Africa Microfinance / Small-Medium Enterprise (SME) funding and obtain a loan?

The borrower must be a private sector micro-entrepreneur or a registered SME based in the country of application. The proposed project should meet sound financial, technical and economic criteria and fall within an eligible sector. Sectors include production, manufacturing, services, trade, tourism and the agro-industry.

Which currencies are available?

Depending on the policy of the approved financial intermediary (AFI), loans could potentially be made available in the local currency, USD, EUR or other currencies traded on major foreign exchange markets.

How does the scheme operate?

All applications must be submitted to the EIB’s AFIs. The AFIs are responsible for selecting and appraising eligible projects and for the submission of funding requests to the EIB for approval. As the AFI will be taking on the credit risk, they will decide on the appropriate security depending on their risk assessment and market analysis. The AFIs due diligence and credit decisions are carried out at the AFI’s sole discretion. 

What is the loan duration?

The loan duration is generally up to 5 years and in certain cases up to 7 years.

Interest Rates:

Interest rates are freely negotiated between the borrower and the AFI. They will typically depend on the market based cost of the EIB’s AAA funding as well as a margin to cover the AFI’s credit risk and administrative costs.

Loan Sizes:

The loan size will depend on the AFI’s policy, but will generally start at EUR 1,000 for micro loans and EUR 50,000 for SME loans.

Owner’s contribution:

Project Promoters should be able to demonstrate a reasonable commitment of their own funds (equity) to back the investment. This amount is to be determined in negotiation with the AFIs.

Eligible project costs:

The project costs may include buildings and related construction costs, equipment, plant, furnishings, services (e.g. marketing and feasibility studies, professional fees associated with the project), provisions for contingencies, interest during construction if applicable, and a reasonable allocation of working capital.

What cannot be financed?

  • Real estate investments
  • Consumer finance (Mortgages)
  • Pure financial transactions
  • EIB excluded activities comprise a.o. ammunitions and weapons, military/police equipment or infrastructure, projects which result in limiting people’s individual rights and freedom or a violation of human rights, projects unacceptable in environmental and social terms, projects in protected areas, critical habitats and heritage sites, ethically or morally controversial projects, activities prohibited by national legislation.

How to apply?

The eligible enterprise should contact the financial intermediaries in the country where the enterprise is established. Selection criteria, conditions, etc. for a loan are determined by each financial intermediary according to its own standards and rules.

Get your project started!

A multitude of companies across the region have already benefited from EIB Global Loan financing, enabling the realization of investment projects in a variety of sectors. Through the provision of long term financing at the most favourable conditions, the EIB Global Loans aim to contribute to the overall development of the private sector in Africa.