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INFORMAL SECTOR STIMULATION PROGRAMME (NEW)

#BuildingBatswanaForBotswana www.ceda.co.bw

LETLHABILE

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3 INTRODUCTION

4 OBJECTIVES

4 TARGETED INFORMAL SECTOR

4 ELIGIBILITY

5 FINANCIAL TYPE OF SUPPORT

5 LOAN AMOUNT LIMIT

5 LOAN INTEREST RATE AND MORATORIUM

5 LOAN INSTALMENT FREQUENCY

5 LOAN TENURE

5 SECURITY

6 LOAN PROCESSING (TURN-AROUND-TIME)

6 ADVISORY SERVICES ELIGIBILITY

6 DELIVERY CHANNELS

7 CHECKLIST

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CONTENTS

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1 | INTRODUCTION

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Letlhabile will focus specifically on uplifting informal sector which has been negatively impacted by its vulnerability and reliance on an active formal sector and the movement of the public, whose mobility has been restricted by travel restrictions implemented to control the spread of COVID 19. The programme will target individuals who predominantly sustain their livelihood through business activities at the micro and informal sector level.

Letlhabile will focus on supporting businesses in the informal and micro enterprise sector that were in existence and trading prior to the COVID-19 pandemic, specifically prior to 29th February 2020.

In order for Letlhabile to achieve its revitalisation objective and support the return of the informal sector businesses post COVID-19 travel restrictions, the programme will offer 3 months’ moratorium or an interest free period to allow businesses to build enough cash flow reserves before they start repaying their loans.

The time horizon for the programme is six months, effective 15 May 2020 until November 2020

The product will provide loans from P500.00 up to P10 000.00

The programme will be delivered through all CEDA branches, supported by Botswana Post acting as an intermediary to receive applications & submit to CEDA. .

Together with the funding intervention, the Agency will undertake capacity building interventions in the areas of; record keeping, business formalisation and packaging and branding. These interventions will be delivered in clusters and where necessary and compelling, interventions will be done at a business level.

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2 | OBJECTIVES

Support the resumption of the economic activities of the informal sector post Covid-19 period

Protect jobs of the self-employed informal sector

Lessen Government intervention to support livelihoods of the populace which was self- reliant Pre-Covid-19

Restore availability of products and services that are provided for the community especially in rural communities and other segments of towns and cities relying on the informal sector

3 | TARGETED INFORMAL SECTOR

RETAIL (Street vendors, Hawkers, General dealers, Tuck-shops, Food vendors at markets)

SERVICES (Hair-Dressers, Car washes, Panel beaters and other artisans, knitters, transport (taxis)

AGRICULTURE (Poultry (eggs and meat), horticulture, Agro-processing

Any other types of micro enterprises will be accepted.

4 | ELIGIBILITY

Any individual who was operating or running an informal business up to the 29th February, 2020

Demonstration of existing capacity to contribute towards the loan being sought to restart the business (monetary or in-kind, such as equipment, tools, machinery, etc.)

4.3 Demonstration of business activity for the period up to 29th February, 2020 through records (stock receipts, suppliers reference, invoices, bank statements etc)

4.4 Botswana citizens of 18 years and above

4.5 Individuals without formal employment

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5 | FINANCIAL TYPE OF SUPPORT

5.1 Working Capital & Asset Finance Loan (Tools, machinery, equipment, Stock, raw materials, fuel or transport)

6 | LOAN AMOUNT LIMIT

6.1 Minimum P500.00 and maximum of P10 000.00

7 | LOAN INTEREST RATE AND MORATORIUM

7.1 Loan shall be charged at 5% interest rate per annum on a reducing balance method

7.2 Interest Free Moratorium period of 3 months from the date of business trading

8 | LOAN INSTALMENT FREQUENCY

8.1 Loan instalments repayments will be accepted on a weekly, fortnightly and monthly basis (Loans can be paid at any interval)

8.2 The frequency will depend on the operational cycle and structure of the business.

9 | LOAN TENURE

9.1 Loan repayments range from 3 months to a maximum of 12 months for working capital facilities

9.2 Repayments for loans including assets (equipment & tools) will be repaid from 3 months up to a maximum of 18 months.

9.3 Maximum loan tenure is 18 months

10 | SECURITY

The following shall be acceptable collateral for any loan granted:

10.1 Personal surety

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11 | LOAN PROCESSING (TURN-AROUND-TIME)

11.1 The loan processing turnaround time will be 7 working days

12 | ADVISORY SERVICES ELIGIBILITY

12.1 Record Keeping through the Local Enterprise Authority (LEA)

12.2 Business formalisation and compliance

a) Facilitation of account opening with commercial banks

b) Facilitation of licensing

c) Facilitation of business registration with CIPA

12.3 Product packaging and branding

13 | DELIVERY CHANNELS

13.1 All CEDA physical branches throughout the country.

13.2 Online submissions will be accepted through the CEDA website www.ceda.co.bw as well as a dedicted email address letlhabile@ceda.co.bw

13.3 Submissions accepted at Botswana Post branches across the country.

13.4 CEDA mobile offices from time to time at areas of need.

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14 | CHECKLIST

LETLHABILE LOAN APPLICATION CHECKLIST (REQUIRED DOCUMENTS) TICK

1. Completed Letlhabile Loan Application Form

2. Certified copy of Omang

3. License to operate business (hawkers/ trading, exemption etc)

4. Company resolution to borrow ( If company)

5. Certified copies of Shareholders & Directors IDs (If a company)

6. Certified copy of Marriage Certificate, where applicable

7. Certified copy of Deeds Marriage Instrument (Form A or B)

8. Certificate of incorporation (If a company)

9. Memorandum & Articles of Association (If a company)

10. Form 2 (If a company)

11. Form 4 & 5 (If a company)

12. Share Certificates (If a company)

13. Company Registration Extract Documents (for companies registered/ re-registered effective 3 June, 2019)

14. Quotations from suppliers

15. Proof of past business activity, not older than the 29th February, 2020 ( Cashbook, Sales book, Invoices & supplier’s receipts etc)

16. Utility Bills / Affidavit/ Letter from Local Authorities eg Kgosi

17. Tax Clearance Certificate where applicable Or Exemption (Valid at least until 31st December, 2019)

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