MAFISA 4 TH QUARTER EXPENDITURE REPORT FOR THE 2009/10 FINANCIAL YEAR S26 NCOP BUILDING, PARLIAMENT 10 th AUGUST 2010

BACKGROUND  MAFISA is operated as an apex system where existing or potential financial intermediaries who are recognised as credit providers in terms of the National Credit Act were accredited as financial intermediaries to retail MAFISA funds.  Currently, 10 financial institutions have been accredited of which 8 are fully operational and each signed a participation agreement with the DAFF in the year 2008 and 2009 respectively for purposes of retailing production loans to emerging farmers and other qualifying applicants.  Existing agreements signed with institutions are that transferred funds revolve within the accredited institution on a dedicated MAFISA account over a period of five years.

CONTINUED  Participating institutions provide performance reports on a monthly and quarterly and annual basis.  For 2009/10 the set target was to accredit 12 financial institutions as MAFISA retail intermediaries  Department staff performs monthly monitoring and inspection to funded projects and internal inspection on dedicated MAFISA accounts within participating institutions.  The types of enterprises funded includes livestock, field crops, vegetables, poultry, ostrich, sugar cane and grapes production etc.  Interest rate charged is 8%

MAFISA BUDGET ALLOCATION Scheme budget was as follows:  2005/06144,000  2006/07 196,000  2007/08 248,000  2008/09 22,1* Allocation was R243,1m funds were reprioritized for ILLIMA projects  2009/10 367,000  TOTAL 977,000  Committed for MAFISA to date 520,000  Transferred to intermediaries 240,000 for production loan purposes  Remainder 336,000 reprioritized for mechanization programme, 146,000 reprioritized to address distressed farms

JANUARY-MARCH 2010 QUARTER (4) PERFORMANCE InstitutionJanuary amount Benefi ciaries February amount Benefi ciaries March amount Benefi ciaries Total Beneficia- ries Total Amount Rural Finance Corporation R R R R National Emerging Red Meat Producers R R R R Magalies Kooperasie R R Hlanganani Farming FinanceR R R Peulwana Financial ServicesR R R Kaap-AgriR MADC Gauteng Economic Propeller TOTALR R R R

Table 1: 2009/10 Performance per Accredited Institution Accredited institutionAmount approved (R million Signed Term Geographic Operation Amount transferred to institutions (Rmillion Amount disbursed for loan to date Beneficiaries Rural Finance Corporation / /14 EC50R 6,6m271 National Emerging Red Meat Producers / /14 National35R 24,3m227 Magalies Kooperasie502008/ /14 NW35R13,09m648 Hlanganani Farming Finance / /14 LP20R 10.8m106 Peulwana Financial Services / /14 KZN/GP20R 8,1m179 Kaap-Agri502009/ /15 WC/NC20R 2.9m29 MADC / /15 MP50R Economic Propeller302008/ /14 GP10R TotalR420mR240mR66.1 m1 465

Table 1: 2009/10 Performance per Accredited Institution Accredited institutionAmount approved (R million Signed Term Geographic Operation Amount transferred to institutions (Rmillion Amount disbursed for loan to date Beneficiaries South African Sugar Association / /16 KZN MP 000 Vrystaat Koperasie Beperk / /16 FS000

IMPACT OF THE SCHEME  Since inception a total of emerging famers access production loans from MAFISA  To date 560 direct jobs created and job opportunities created through seasonal labour  Average repayment rate is currently standing at 75%

THE END I THANK YOU