HOW IDCE APPROVED, THEN CANCELLED E4.2M LOAN

MBABANE – Talk about a shattered dream! This is exactly what happened to a local businessman, whose dream of owning a trucking business exploded in his face after his loan was approved and later cancelled by the Industrial Development Company of Eswatini (IDCE).

IDCE is a development finance institution formed to promote industrial growth in Eswatini, and it fulfils its role by promoting and investing in financially viable projects in various sectors.
Its mandate correlates well with government’s Strategic Road map, whose priorities include promoting small and medium enterprises by ensuring access to finance.

Trucking

Having been in the distribution industry for years, the businessman, Sandile Tsabedze (46), decided to give the trucking sector a try.
To fulfil his dream, he decided to extend a loan request to the IDCE in October 2016 and was asked to submit all relevant documents, which he claims he did.
For months, he waited in anticipation for his loan request to be approved.

It was on February 16, 2018 that IDCE lived up to its slogan of being ‘the development financier worth talking to’ as it issued the all important approval letter that Tsabedze had been waiting for.

The letter, which this newspaper is in possession of, informed him that his company, Brave Fortune Investment (PTY) Limited, had its loan application approve under the Asset Leasing Finance product of IDCE.

The letter, dated February 18, 2018, detailed the lease terms, one of which was the amount of the loan, which was set at E4 271 096.
The interest rate, according to the letter, was set at 15 per cent per annum, floored the same percentage while the appraisal fee was to be one per cent of E 4 745 662 which is equivalent to E47 456.

Another term included in the letter was that Tsabedze’s company was expected to pay a commitment fee set at 10 per cent of E4 745 662, which is equivalent to E474 566.
The duration of the lease was for up to a maximum of 60 months.

Furthermore, the business was expected to incur management fees at a minimum charge of E150 per month.
For security, the letter stated a lien over leased assets which were a cession of Life Insurance Policy worth E2 million held by Old Mutual and a surety mortgage bond over property on Lot 1598 Extension 17, Helemisi Township, Manzini.

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