Core Loan Parameters
| Parameter | Value |
|---|---|
| Minimum loan amount | R100,000 |
| Maximum loan amount | R5,000,000 |
| Minimum term | 6 months |
| Maximum term | 24 months |
| Monthly interest rate | From 3.5% (on reducing balance) |
| Approximate annual cost | ~R24,000 per R100,000 over 12 months |
| Repayment frequency | Weekly or monthly (debit order) |
| Application fee | R0 |
| Origination/initiation fee | R0 |
| Administration fee | R0 |
| Early settlement fee | R0 |
| Collateral required | None (unsecured) |
| Personal surety | May be required for directors/shareholders |
Eligibility Requirements
For loans of R100,000 – R500,000:
| Requirement | Threshold |
|---|---|
| Business registration | Registered Pty Ltd or Close Corporation |
| Minimum trading period | 12 months fully operational |
| Minimum annual turnover | R1,000,000 (R100,000/month) |
| Bank statements required | 6–12 months |
For loans of R500,000 – R5,000,000:
| Requirement | Threshold |
|---|---|
| Business registration | Registered Pty Ltd or Close Corporation |
| Minimum trading period | 24 months fully operational |
| Minimum annual turnover | R10,000,000 |
| Bank statements required | 12 months + management accounts |
Entity types accepted: Private companies (Pty Ltd), Close Corporations (CC) Entity types NOT accepted: Sole proprietors, partnerships, trusts, NGOs, startups
Total Cost of Credit — Worked Examples
Example 1: R200,000 over 12 months
- Monthly rate: 3.5% on reducing balance
- Approximate total interest: ~R48,000
- Approximate total repayment: ~R248,000
- Monthly instalment: ~R20,667
Example 2: R500,000 over 18 months
- Monthly rate: 3.5% on reducing balance
- Approximate total interest: ~R180,000
- Approximate total repayment: ~R680,000
- Monthly instalment: ~R37,778
Note: These are illustrative estimates. Actual rates depend on business risk profile, turnover, and trading history. Genfin provides a personalised quote before any commitment is required.
Why Reducing-Balance Interest Matters
Under a reducing-balance model, interest is calculated only on the outstanding loan balance — not the original principal. This means:
- Month 1: Interest calculated on full R200,000
- Month 6: Interest calculated on approximately R100,000 (after 6 months of repayments)
- Month 12: Interest calculated on the small remaining balance
This approach is significantly cheaper over the life of the loan compared to flat-rate or factor-rate models used by some competitors, where interest is applied to the original amount regardless of repayment progress.
Risk Warning
Important: Business loans are a financial obligation. Failure to meet repayment obligations may result in legal action, damage to your business credit record, and personal liability if a surety has been signed. Never borrow more than your business can comfortably service from operating cash flows. The interest cost of R3.5% per month is material — over 12 months this equates to an effective annual interest charge of approximately 42% on the principal, though the reducing-balance method means actual interest paid is lower. Verify all final terms in your signed loan agreement before drawing down funds.