Name of the fund
Mercantile COVID-19 SME Loan Scheme
Fund administered by
Mercantile, on behalf of National Treasury and the South African Reserve Bank
Type of relief/support
Total size of the fund
Who does the fund target?
Businesses with a turnover of less than R300m per annum (measured at a group level)
Minimum amount you can apply for
Maximum amount you can apply for
Please note there may be changes to the Term Loan Scheme, discussions are currently under way with National Treasury and the Reserve Bank. A portion of the funds will be set aside to help businesses restart. Please speak with your business banker for more information regarding this.
APPLICATIONS FOR THE COVID-19 TERM LOAN SCHEME WILL CLOSE ON 11 JULY 2021.
ABOUT THE MERCANTILE COVID-19 SME LOAN SCHEME:
- The funding will be in the form of a three-month loan, drawn down monthly.
- The Covid-19 loan will enable qualifying businesses to get a loan for up to three months for certain operational costs and will be drawn down monthly. The interest rate on the loan is priced at the prime lending rate by all participating banks.
- The loan has a payment holiday for the first six months (interest is capitalised) from the date of the first drawdown.
- From month seven, the outstanding capital and interest roll-up, from the first six months, will be amortised over a period of five years (60 months) and the first payment will be due.
- Please note that only one application can be made to one bank, and each loan will be subject to each bank’s normal risk evaluation and bank credit application and granting process.
- A personal guarantee may be required.
PURPOSE OF THE MERCANTILE COVID-19 SME LOAN SCHEME:
The loan is intended to cover specific operational expenditures of the business and is limited to:
- Salaries and wages which applied at 1 March 2020 to employees and directors, trustees, members and other like officers.
- Rentals and lease payments in force on or before 29 February 2020.
- Supply chain costs, meaning the direct and indirect costs and expenses associated with the domestic and/or foreign supply of goods, materials and services to a business, including (without limitation), the costs and expenses of importing and exporting goods and materials.
- Utilities and insurance premiums.
- Other operating expenses limited to security services, cash in transit services, cleaning and maintenance services.
THE MERCANTILE COVID-19 SME LOAN SCHEME CANNOT BE USED FOR:
- To pay any distributions of any nature whatsoever to shareholders, trustees, beneficiaries, partners and/or directors (except for salary payments to any such parties) and/or repay or prepay any capital or interest on any shareholder, trustee, beneficiary, partner and/or director loans.
- To repay or pre-pay any existing bank debt facilities at any bank.
FUNDING CRITERIA FOR THE MERCANTILE COVID-19 SME LOAN SCHEME:
An eligible business is defined as:
- Any company, statutory body corporate, close corporation, sole proprietorship, trust or partnership, association, joint venture or any similar entity, but excludes state-owned entities, listed companies and companies with capital market funders or funding instruments.
- Having an annual turnover below R300m (measured at group level) where annual turnover is measured as the aggregate gross revenue of the business (determined on a group basis) for the most recent financial year or the 12-month period ending on 29 February 2020.
- Being registered with SARS.
- Having no existing capacity to borrow.
- Being in financial distress as a result of the lockdown an entity that has declared that it has not applied for this relief at any other bank.
HOW TO APPLY FOR THE MERCANTILE COVID-19 SME LOAN SCHEME:
Complete the application form via https://www.mercantile.co.za/sites/default/files/Mercantile_Bank_COVID-19_SME_Loan_Application_Form.pdf
ADDITIONAL INFORMATION FOR THE MERCANTILE COVID-19 SME LOAN SCHEME:
086 030 9250