Funding opportunities 

Below are some of the funding opportunities available in the agriculture sector and the broader green economy.

 

National Youth Development Agency (NYDA) Grant Programme

The NYDA Grant Programme is designed to provide young entrepreneurs with an opportunity to access both financial and non-finanacial business development support in order to enable them to establish or growth their businesses. To quality, entrepreneurs must be: i.) a youth of 18 - 35 years old; ii.) youth with skills, experiences or; with the potential skill, appropriate for the enterprise that they conduct or intend to conduct; iii.) are South African citizens and; iv.) are residents in South Africa.

 

An individual can received no more than R200 000 (R250 000 for agriculture and technology-related projects) cumulative grant amount from NYDA. Learn more about the programme and application process here

 

Nedbank Fairshare

Nedbank Business Banking wants to partner with business in offering financing for energy-efficiency and renewable energy projects of all sizes, either for outright purchases or third-party ownership solutions. 

Click here to visit the Nedbank Fairshare brochure. 

 

AgriBEE fund

The AgriBEE Fund is a support programme initiated by the Department of Agriculture, Forestry and Fisheries as an intervention to support black-owned small agricultural enterprises, previously excluded, to participate in mainstream economic activites with a view of enhancing the transformation agenda in the sector. The Fund's mandate was extended to also include promotion of enterprise development initiatives through value-add and agro-processing infrastrature.

Eligible applicants are: i.) South African citizens and permanent residents; ii.) the entity is 100% black-owned (as defined in the Broad Based Black Economic Emppowerment Act 54 of 2003; iii.) applicant must either be able to qualify as an EME or QSE in line with the applicable Sector Codes; iv.) applicant must have been directly involved in the commodity or industry where investment is sought and should have been operating for, at least, the past three (3) consecutive years; v.) applicants may use funds for the start-up, expansion and aquisition of equity and shares in a viable and sustainable enterprise.

Minimum grant for each applicant is R 1 000 000 (with applicant contribution of 10%) and the maximum, R 5 000 000 (with applicant contribution of 20%). More information can be found here

 

Micro Agricultural Financial Institutions of South Africa (MAFISA)

MAFISA is a financial scheme to address financial services needs of smallholder farmers and agribusinesses, providing capital loans to engance agricultural activities.

Eligible candidates must be South African citizens (21 or older) with valid SA ID from historically disadvantaged groups. The enterprise farms must have positive credit history and show its ability to repay the loan.

The loan may be used for the purchase of: i.) production inputs such as fertilizers, seeds, pesticides etc.; small equipments and implements such as Knapsack spray, bird drinkers and feeders etc. and; breeding livestock, medication, feed and branding materials etc. Loans may be up to R500 000 per person at 8% interest pa. Applicants may request forms from their local agricultural extension officer or DAFF national officials, PortiaMahl@daff.gov.za and ElizabethKh@daff.gov.za. More details can be found here

 

Funding for emerging farmers

Emerging Western Cape fruit farmers are set to receive R120 million in funding to boost their businesses. Alan Winde, Minister of Economic Opportunities, said 20 black deciduous fruit farmers in the province would benefit from the grant which the province secured through an application to the Jobs Fund. The goal of the fund is to support smallholder farmers to reach commercial status.

For more information, click here

 

African Development Bank (AfDB)

Presentations on agricultural funding offered through the AfDB, including requirements (as presented at the African Investment Indaba 2019):

 

Green Energy Fund

The Industrial Development Corporation (IDC), through this project, supports businesses who wish to invest in energy efficiency and renewable energy technologies. Support includes loans from R1m to R50m, technical support and financial assessments. Green EE Fund

The above mentioned only applies to agro-processing.

 

ESCo Model funding programme

The ESCo Model funding programme forms part of Eskom's strategic commitment to support customers with funding and advice on how to save energy and, as a result, lower their operating costs. 

For more information visit: ESCo Model funding programme

 

The U.S. Trade and Development Agency (USTDA)

The U.S. Trade and Development Agency is the U.S. government’s project preparation agency. USTDA funds feasibility studies, technical assistance and the comprehensive analysis that infrastructure projects in emerging markets need to move from concept to financing and implementation.

In the agribusiness sector, USTDA grant activities support to U.S. solutions that advance the safety, security and sustainability of food supply in sub-Saharan Africa through the deployment of U.S. technologies for irrigation, production, storage and transport.

More information on how to apply for USTDA grant funding can be found at the following link: here

Nourishing Africa

The Nourishing Africa hub provides a platform that provides information about funding, e-learning and capacity building opportunities and other resources to support Agri-businesses scale up their impact. The link to the platform can be found here

 

 Incentives

Below are some incentive schemes available in the agriculture sector and the broader green economy.

Government Investment Incentives

The link below is the official portal for South African Government Incentives Schemes. Here you will find more information on incentives for research and development, capital expenditure, enhanced competitive advantage, specific industries and local and provincial governments. You will also find a guide to investing in South Africa.

South African Government Incentives Schemes

Wesgro's summarised incentive booklet

Source of Finance Book (Western Cape Department of Agriculture, 2017)

 

Department of Trade and Industry (DTI) Incentives

You can view the latest developments on incentives here as well as the uptake of these incentives per province for 2015/16. Agro-processing dominates uptake of incentives for the Western Cape. Note that the 12i Tax Allowance will come to an end in 2017, last submissions will be taken in Dec 2017. The Aquaculture Development and Enhancement Programme's (ADEP) reimbursement cost-sharing grant has increased from R 30 million to R 40 million. You can get more information at the links below (contact details included):

Latest developments on incentives

Annual performance of programmes

 

Energy efficiency incentives

Tax Allowance for Energy Efficiency Savings

The 12L EE Tax Incentive allows for tax deductions for energy efficiency projects that reduce energy use. Taxable income deductions are 95c/kilowatt hour (increased from 45c after 2015 Budget Speech) of energy saved and is expected to be claimable until 2020.

For more information visit: 12l EE Tax Incentive 

                                           FAQ'S on 12l EE Tax Incentive

 

Incentives for assets purchased

Capital Development Expenditure

This incentive is in the form of a tax deduction for capital expenses incurred for farming operations (game farming included). This deduction includes the following for sustainable agriculture: the eradication of noxious plants and alien invasive vegetation; the prevention of soil erosion and dams, irrigation schemes, boreholes and pumping plants.

For more information visit: Capital Development Expenditure

 

Machinery, plant, implements, utensils or article acquired

The purchase of machinery, plant, implements, utensils or articles is granted a tax allowance for the following:

  • Farming- assets owned or acquired and brought into use for the first time.
  • Production of biofuels- assets owned or acquired, for the purpose of trade, brought into use for the first time for the production of bio-diesel or bio-ethanol.
  • Generation of electricity- assets brought into use for the generation of electricity from wind, sunlight, gravitational water forces and biomass.

For more information visit: Taxation in South Africa Guide

 

Environmental Incentives

Environmental expenditure

Tax allowance for environmental expenditure is granted for the following:

  • Environmental treatment and recycling asset
  • Environmental waste disposal asset
  • Post-trade environmental expenses

 

Environmental maintenance expenditure

A tax allowance for expenditure incurred to conserve or maintain land is granted under the terms of the National Environment Management: Biodiversity Act 10 of 2004.

For more information visit: Taxation in South Africa Guide

  

Green Tourism Incentive Programme

The Green Tourism Incentive Programme (GTIP) is an initiative of the National Department of Tourism with a key objective of encouraging privately-owned tourism enterprises to move towards cleaner and renewable energy sources and the efficient utilization of water. Managed by the IDC, financial assistance under the GTIP is provided in the form of a grant of up to R1 million to qualifying small and micro tourism enterprises.

For more information, click here. Applications open until 30 November 2018.

 

Agro-Processing Support Scheme (APSS)

The Agro-Processing Support Scheme (APSS) aims to stimulate investment by the South African agro-processing / beneficiation (agri-business) enterprises. The investment should demonstrate that it will achieve some of the following: 
Increased capacity, employment creation, modernised machinery and equipment, competitiveness and productivity improvement and broadening participation. 

Benefits

  • The scheme offers a 20% to a 30% cost-sharing grant to a maximum of R20 million over a two-year investment period, with a last claim to be submitted within six months after the final approved milestone.
  • the dti may consider an additional 10% grant for projects that meet all economic benefit criteria such as employment, transformation, geographic spread and local procurement.
  • The maximum approved grant may be utilised on a combination of investment costs provided the applicant illustrates a sound business case for the proposed investment activities.

Links to relevant documents can be found below:

Programme Guidelines

Application form 

APSS Power Point