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Project Briefs of 2004 Projects
The programme combines five inter-linked financial and technical components with the objective of promoting franchising as a business strategy to develop SMEs amongst Previously Disadvantaged Individuals in SA. This programme will provide the learning experience for its subsequent replication throughout the continent. The programme to finance franchisees in South Africaincludes four main components: (i) An Extended Finance Facility (EFF) established to enhance the gearing of franchisees’ businesses by providing a deferred loan (subordinated) with a grace period of up to 5 years; (ii)Debt financing (senior loan) provided by the financial institutions; (iii) A guarantee mechanism which covers part of the debt financing; and (iv) A Mentoring Facility which provides franchisees with management skills and training, and monitors the performance of the participating franchising businesses.