The Department of Trade and Industry’s (DTI) Black Industrialist Scheme (BIS) continues to perform well and it’s confirmed that this grant fund will continue to run for the foreseeable future.
The BIS is one of the department’s flagship grant schemes and businesses would do well to understand a bit more about it so they can be prepared if they want to consider applying for it.
Here are some facts about the grant.
The Black Industrialist Scheme is:
- A cost sharing incentive of between 30% to 50% of CAPEX requirements, to a maximum of R50 million. E.g. Assume a R150 million project (OPEX plus CAPEX) with your CAPEX (tools, machinery and equipment, some commercial vehicles and building improvements) equalling R100 million of the total. You score on the low end and qualify for 30% cost sharing. That means you receive R30 million as a grant and now only need to raise the remaining R120 million through debt and/or equity. If you score full points and qualify for a 50% grant, you receive R50 million as a grant and now only need to raise R100 million through debt and/or equity.
- Funding of up to R50 million in grant capital per applicant. This is money never to be repaid – in exchange for economic development and job creation.
- A rebated incentive, i.e. you don’t get the grant in cash to procure the assets you need. You must utilise your debt or equity finance to initiate the process and claim back your spend according to the percentage (30%-50%) you were approved for.
- For commercially viable and bankable manufacturing businesses, to invest in establishing or increasing their production capacity (among other investments into the business).
- For empowered (majority black-owned) manufacturers with majority black management control.
- A process. Preparation of bankable documents and applications should commence as early as possible in order to provide sufficient time for diligent preparation, approval and implementation of your project, with a medium-term implementation timeline expected.
- It works. Uzenzele has successfully supported Black Industrialists raise millions in grant funding through the BIS, with a 100% success rate.