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Revolving Fund

Revolving Fund

ABOUT THE REVOLVING FUND

Everything you need to know about the Modi Trust Revolving Fund

Frequently Asked Questions About The Revovling Fund

WHAT IS A REVOLVING FUND?

A revolving fund is a fund or account that remains available to finance an organisation's continuing operations without any fiscal year limitation, because the organisation replenishes the fund by repaying money used from the account.
This revolving fund shares many characteristics with microcredit, it provides loans to persons or groups of people that do not qualify for traditional financial services or are otherwise viewed as being high risk. Borrowers will be small scale businesses or persons that have no credit history or access to other types of loans from financial institutions.

WHO OWNS THE FUND ?

The Revolving Fund is owned by the Modi Trust. Both the Trust and the Fund have been established in and under the laws of Zimbabwe. The board of Trustees was selected on the basis of their knowledge and expertise, relevant to the purpose and objectives of the Trust, but they do not represent the interests of Bulawayo South Constituency.

WHAT ARE THE PURPOSE AND OBJECTIVES OF THE TRUST ?

The Trust was established as a legal entity, with the explicit purpose of carrying out the objective of contributing to sustainable and equitable economic development in Matabeleland with the Revolving Fund specifically targeting Bulawayo South, wherein the beneficiaries will be: small scale businesses, cooperations, societies and individuals in the constituency.

FROM WHERE DOES THE FUND'S MONEY COME ?

The Modi Trust has provided the start-up capital ($100 000) to the Fund. Other donors, social investors, and philanthropic agencies, within and outside Zimbabwe, are invited to provide additional capital to the Trust to fund its growth and sustainability. The intention is for the Trust Fund to be a revolving fund that is sustainable in its own right.

WHAT KINDS OF PRODUCTS AND SERVICES DOES THE FUND OFFER ?

It mainly provides zero interest loans, tailored to the specific risks and circumstances of each qualifying entrepreneur. On a very limited basis, the Fund will use grants to partially pay the costs of capacity building services for beneficiaries.
Due to the depressed economy, many small scale businesses face an uphill battle when determining strategies for profitability restoration. It is imperative to take swift, appropriate measures in order to sufficiently address financial and operational difficulties. The Trust provides turnaround consulting services across diverse small scale businesses in a wide range of situations. Our professionals deploy financial and operational rescue tactics necessary to restore profitability in the most practical manner possible.

DOES THE FUND GIVE OUT GRANTS ?

No. The Fund only offers zero interest loans to organisations and individuals who have small scale business or business proposals.

WHAT ARE THE ELIGIBILITY CRITERIA TO QUALIFY FOR A LOAN?

Any organisation applying to the Trust must meet ALL of the following criteria:
1. Be from Bulawayo South
2. Must have proof of residence
3. Business plan or existing business
4. Credible guarantors
5. Signed and stamped recommendation letter
6. Certified copies of identification cards/passports
7. Have no criminal record
They must also meet at least two of the following four criteria:
1. At least 25 percent of the borrowers should be women
2. At least 25 percent of the borrowers should be youth
3. Have a cash flow projection

IF I MEET THE ELIGIBILITY CRITERIA, WILL I AUTOMATICALLY GET A LOAN ?

No. The eligibility criteria only provide an initial screening of applicants. The decision about whether or not an applicant receives a loan is subject to a detailed institutional review and due diligence, which, in turn, is reviewed by the Credit and Risk Committee of the Trust, in which the final decision to lend, or not, resides.

WHAT KINDS OF INTEREST RATES DOES THE FUND CHARGE ?

There are no interests whatsoever.