Table of contents
- Glossary of Definitions and Abbreviations
- Chapter 1. Crowdfunding Regulatory Regime
- Section 1.1 Private companies raising publicly: a new regime for African SMEs
- Section 1.2 Crowdfunding Intermediary: a new regime for African intermediaries
- Section 1.3 Crowdinvestors: a new regime for African individual investors
- Section 1.4 Implementation of the ACfA Label Framework
- Title 1.4.1 Recognition of the SRO by national regulatory authorities
- Title 1.4.2 Cross-border securities-based crowdfunding operations
- Title 1.4.3 Treatment of non securities-based crowdfunding operations
- Chapter 2. Crowdfunding Intermediaries
- Section 2.1 ACfA Label Categories
- Section 2.2 Applications
- Chapter 3. Types of Crowdfunding Operations
- Section 3.1 Crowdfunding Operations permitted only under Category 1
- Section 3.2 Crowdfunding Operations permitted under both Category 1 and Category 2
- Section 3.3 Treatment of offerings not considered as securities
- Chapter 4. Marketing
- Chapter 5. Cross-border Crowdfunding
- Chapter 6. Privacy and Data Protection
- Chapter 7. Anti Money Laundering and Terrorism Financing
- Chapter 8. Supervision, Audits and Enforcement
g. SME “Minibonds”
Project sponsors that are small and medium-sized enterprises may issue “SME minibonds” to crowdinvestors. A minibond is a note with simple terms: a fixed interest rate, fixed repayment schedule (for example, quarterly repayments) and a fixed horizon (for example, three years). Minibonds shall be issued by project sponsors with short to medium term credit needs. The requirement of collateral and form of collateral are not prescribed.
h. Loans (“Crowdlending”)
Intermediaries may facilitate crowdfunding operations in which crowdinvestors lend to project sponsors. Interest rates are subject to all applicable local laws. The requirement of collateral and form of collateral are not prescribed. Repayment options may be tailored to the cash-flow of the project sponsor.
i. Revenue-based finance
Project sponsors may provide crowdinvestors with securities whose returns are linked to the performance of the project sponsor. This performance shall be measured by a predefined accounting multiple such as sales, revenues, EBITDA or profit. The revenue-based security may take the form of a percentage of these revenues and be capped at a multiple and/or self-liquidate after a period of time. The securities may have other provisions for loss limitation.
j. Convertible loans
Crowdfunding operations may be run for convertible loans, which are loans that are structured with the option to be converted into shares of the project based on certain predefined milestones.