The Project entails funding of SA Taxi Development Finance Proprietary Limited (SATDF), a South Africa’s mass transit financial solutions provider, that onlends to small and medium enterprises (SMEs) that may otherwise not be able to access financing. The financial package comprises of a senior loan of US$10 million and an associated facility of ZAR 1.4 billion (about US$$97 million) with an 8-year tenor, including 6-month grace period. SA Taxi is an important service provider to South Africa’s minibus commuter transit segment, which is commonly referred to as its “taxi” industry. The demand for commuter transit minibuses is strong, as approximately 69 percent of public transport commuters opt for this transport mode (compared to 20 percent for bus and 11 percent for train). The country’s 16-seater minibus taxis do approximately 15 million commuter trips per day, which services nearly 40 percent of the population. SA Taxi currently has 30,000 customers who have financed on average 1.2 minibuses. However, 90% of SA Taxi clients do not qualify for the formal banking sector. With the funding, SMEs will acquire fuel efficient, environmentally-friendly, quality vehicles (minibus taxis) to be used for mass transit across South Africa. The Project will catalyze funding for approximately 8,000 commuter transit vehicles, or nearly 7% of the current need in the country, thereby supporting nearly 600,000 safer daily trips. The asset-backed financing operation is expected to attract funding interest from international commercial banks for the benefit of South Africa’s mass transit sector.

South Africa

African Development Bank Group

Africa Southern Africa Sub-Saharan Africa

Construction Energy-Power and Electrical Computer Hardwares and Consumables

17.10.2018

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