Danida Business Finance

DB Finance increases access to long-term financing through involvement of commercial actors for investments in important infrastructure, especially in Africa, which will lay the groundwork for economic growth. DB Finance also aims at minor industrial projects with direct job-creating potential, which cannot be financed on normal market conditions.DB Finance targets key infrastructure sectors where investment improves the climate for economic development, in particular for the private sector. The main sectors are transportation, energy, water supply and sanitation. In all areas, climate-friendly and cleaner technology is a top priority.

Subsidy in relation to contract and loan amounts(click to view larger size)

WHAT DOES DB FINANCE OFFER?

DB Finance offers interest-free or low-interest loans. A typical loan has 10 years’ maturity and is issued in USD or EUR. The subsidy under DB Finance consists of up to three elements (see figure below):

• Payment of interest – in full or in part.
• Payment of the export credit premium and other financial costs.
• Cash grant to reduce the principal of the loan, if the above does not amount to the subsidy level required by the ruling OECD agreement.

The buyer/borrower repays the loan in equal, semi-annual instalments, normally starting six months after the commissioning of the project. The borrower will pay only a commitment and a management fee.

 

Distribution of approved DB Finance projects