It is against this backdrop that the Government of Ghana obtained World Bank credit to, among other things, implement a matching grant scheme to support the private sector achieve accelerated growth within the short to medium term.
The objectives of this technical assistance project are as follows:
Access to Finance component:
1. increase the creditworthiness of prospective clients of the partner banks, thus increasing the number of new SME loans
2. Help SMEs that have received loans from the partner banks to remain bankable, thus reducing the number of NPLs and increasing the growth of the firms
3. Help business service providers to help expand services tailored for targeted SMEs; and
4. Support financial institutions that wish to develop and expand term lending to SMEs or to develop additional financial instruments suitable for SMEs.
Access to Markets;
1. Stimulate demand by eligible MSMEs for non-financial services that can improve their productivity and competitiveness
2. Enable BDS providers to develop and market specialized BDS that are appropriate and affordable to MSMEs;
3. Improve market information and public-private dialogue through support to business associations and policy advocacy groups. The Fund will also facilitate linkages between MSMEs and larger firms and markets through support to clusters of firms or lead firms working with such clusters of MSME suppliers.
Mini-grids and Grid-Connected Renewable Energy Component;
1. Stimulate and develop markets, suppliers and projects for renewable energies targeting electricity provision for mini-grid, grid-connected and off-grid applications
Types of grants are available
There are 4 types of grants available from the MSME Program. They differ from each other by their purpose, size, duration, payment method and other aspects if applicable. The types of grants that may be awarded are:
Partner Support Fund (PSF)
Mini-sized Grant
Medium-sized Grant
Large-sized Grant
A PSF has the following specifications;
Max. Grant period; 3 – 9 months
Total amount available; USD. 200.000
This grant is available only to Business Associations and BMOs whose activities are consistent with both Beneficiary and MSME objectives.
Approval of facility required from Supervisory Board
Completion of application forms
Payment type; reimbursement of allowable expenses supported by bona fide receipts from beneficiary and Consultant will be paid according to the conditions of the Contract Agreement.
A mini-sized Grant has the following specifications;
Max. Grant period; up to August 2012
Max grant amount; $. 20.000
This grant is available for beneficiary activities which are consistent with both Beneficiary and MSME objectives but which are not necessarily part of a strategic plan.
The mini-sized Grant will not necessarily preclude the Beneficiary from also receiving a large-sized Grant Approval of facility by BDS Fund manager and MoTI (no objection)
Completion of application forms
Payment type; reimbursement of allowable expenses supported by bona fide receipts from beneficiary and Consultant will be paid according to the conditions of the Contract Agreement.
A medium-sized Grant has the following specifications;
Max. Grant period; up to August 2012
Max grant amount; $. 50.000
· This grant is available for beneficiary activities which are consistent with both Beneficiary and MSME objectives but which are not necessarily part of a strategic plan
Approval of this facility by the Supervisory Board is required
Completion of application forms
Payment type; reimbursement of allowable expenses supported by bona fide receipts from beneficiary and Consultant will be paid according to the conditions of the Contract Agreement.
A large-sized Grant has the following specifications;
Max. Grant period; up to August 2012
Max grant amount; $. 200.000,00
Available for beneficiary activities which are consistent with both Beneficiary and MSME objectives but which are not necessarily part of a strategic plan
Approval required from Supervisory Board
Completion of full application forms
· Payment type; Bona fide receipts from beneficiary. Consultant will be paid according to the conditions of the Contract Agreement
Target Beneficiaries and Eligibility Criteria of the BDS Fund
Generally, the target beneficiary
· must, in principle, be privately owned. Certain exceptions, e.g. training institutions, may be appropriate and can be approved on a case by case basis,
· should not be in receipt of financial support from any other source for the activities for which they are seeking support from the BDS Fund.
· should be in a position to commence the project within four weeks after signing the Contract.
· must show a commitment to sustainable development in the short to medium term and demonstrate a planned approach to achieving their objectives.
· must be a registered business in Ghana
· must have the capacity to enter into a binding contract under the laws of Ghana and implement the proposed BDS Sub-project agreement (and be able) to provide a matching contribution as specified in this manual
· is eligible to receive subsequent BDS Grants if it has completed the BDS project in the preceding Fiscal Year to the satisfaction of the BDS Fund Manager, in accordance with the terms of the BDS Grant Agreement.
Terms and Conditions of BDS Grants
The following terms and conditions of BDS grants also apply to all grant beneficiaries.
§ The BDS grant beneficiary shall carry out the sub-project with due diligence and efficiency and in accordance with sound technical, engineering, environmental, financial and managerial practices and maintain adequate records to reflect, in accordance with sound accounting practices, the operations, resources and expenditure relating to the BDS sub-project
§ Goods, works and consultants’ services to be financed from proceeds of BDS grants shall be procured in accordance with procedures ensuring efficiency and economy
§ The BDS Fund Manager, on behalf of MSME, reserves the right to
o Inspect by himself, or jointly with the Funding organisation if so requests, the goods, works, sites, plants and construction included in the BDS sub-project, the operations thereof and any relevant documents
o Obtain all information, as he/she, or the IDA, shall reasonably request regarding the administrative, operation and financial conditions of BDS sub-projects
o Suspend or terminate the right of any BDS beneficiary to use the proceeds of the BDS grant upon failure by the BDS beneficiary to perform any of its obligations under the BDS grant agreement
Access to Finance
Specifically, the target beneficiaries under the Access to Finance window of the BDS Fund are:
· SMEs with at least 51 percent of voting stock held by the private sector;
· SMEs with less than 10 percent of its capital held in the aggregate by the Participating Bank or related entities;
· SMEs in compliance with the IFC’s environmental procedures and policies and IFC’s Financial Intermediary Environmental compliance guidelines.
· SMEs with total assets between US$50,000 and US$2 million equivalent, excluding landed property.
· Participating Financial Institutions and other eligible banks seeking to develop and expand efficient term lending to SMEs
· Eligible business development service providers, including training providers, to implement a range of services to support SME borrowing capabilities and post-borrowing performance.
Access to Markets
The target beneficiaries under the Access to Markets window of the BDS Fund are:
§ MSME manufacturers in agri-business, food processing, plastics, salt, cosmetics, textiles and garments, tourism, horticulture, furniture industries providers of services in the construction industry and other sectors of interest to the National Economy.
§ providers of business services that show clear market demand for the service proposed, lowest cost compliance with technical criteria, substantiated evidence that they possess, or have a credible program to develop, the institutional capacity to deliver on a performance-based agreement and a business strategy for commercial viability. Specific eligibility criteria include (but are not limited to) the following: technical competence/experience, governance, commitment to the project, financial capacity, institutional capacity, reputation, business strategy, and operating strategy. The providers will receive support for (i) market research and product adaptation and development; and (ii) some portion of the delivery cost, on a decreasing basis.
§ Business and representative associations that are registered in line with normal regulatory requirements in Ghana.
Renewable Energy
Eligible activities under this window shall include business plans preparation, market development, feasibility studies, loan application documentation, environmental and social impact assessment of small and mini-hydro projects, set-up of local solar PV dealership, etc. In addition, matching grants are available to suppliers for the costs of piloting innovative ways of supplying renewable energy (mini-grid and grid-connected, as well as off-grid).
Consistent with the target beneficiaries of the BDS Fund, those eligible for matching grants through the Renewable Energy window include:
· Suppliers of renewable energy (such as small hydro, solar PV, wind, biomass) for electricity generation;
· Business and representative associations that wish to develop renewable energy projects for grid connected and mini-grid power generation systems.
· Business and representative associations (including Companies, NGOs and community-based organizations) that wishes to promote off-grid electricity application for remote rural communities and islands as well as set up local dealership in renewable energy products within the communities.
· Financial institutions[1] that wish to develop financial products specifically for renewable energy products and suppliers (grid-connected, mini-grid, or off-grid).
Cost Sharing Principle
All eligible approved costs under the BDS Fund will be shared 50:50 between the beneficiary company and the Fund for first time applications. Cost sharing for repeat applications will be on a graduated basis. This is because such beneficiaries may, after benefiting from the first grant, appreciate the use of such services, and must be willing to pay increasingly more for similar services.
In kind contribution can be taken into consideration, but is subject to a letter of justification. Such a contribution will be evaluated by the Fund Manager together with MoTI/MSME PCU for final approval.
For all Grants, in kind contribution should not exceed 20 % of the total contribution by the Beneficiary. The decision of approval of the in kind contribution is no subject for any further discussion or re-submission.
Examples of in kind contribution are;
a) Air tickets
b) Hotel and/or lodging accommodation
c) Transport costs based on log book administration
d) Conference or Training accommodation and facilities
Grant Application procedure
An organization may apply for a grant by submitting an application in the format. All grants applications must be submitted in electronic form to
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and 3 hard copies to:
BDS Fund Secretariat,
At the office of SNV Ghana,
No. 6 Mankata Close, Airport Residential Area
P. O. Box KIA 30284, Airport - Accra, Ghana
Required format for submitting a grant application
The precise format for submission of a grant application depends on the type of grant. Only applications conforming to one of the following formats will be acceptable for evaluation.
1. Format of applications for PSF Grant. PSF Grants must be submitted in the following format:
Ø Cover letter. The cover letter and attached documentation evidencing compliance with the preconditions specified in paragraph 1.4 is required to conform to the application for PSF Grants
Ø Full application. The required contents for a full application to conform to the application format for PSF grants are specified in Annex 2
2. Format of applications for mini – medium- & large size grants must be submitted in the following format:
Ø Cover letter; The cover letter and attached documentation evidencing compliance with the preconditions specified in paragraph 1.4 is required to conform to the application for mini -, medium- and large size Grants.
Ø Full application. The required contents for a full application to conform to the application format for mini -, medium- & large size grants.
Concept papers:
§ What if an organization has an idea for a grant, but wants to explore that idea in advance of investing the time and money that may be involved with submitting a full application? For all grants except mini grants, a prospective Beneficiary may submit a concept paper describing the program concept for which it is considering seeking grant funding. Submission of a concept paper is highly recommended but not required in respect of PSF grants, medium and large size grants.
§ If an organization submits a concept paper, how will it learn if the concept is acceptable to the MSME Program? The MSME Program will formally inform the organization in form and substance which indicates if the concept is acceptable or not. If the concept is acceptable, the same letter will request applicant to submit a full application in the format described in this handbook. If the concept is not acceptable, the same letter will indicate why the concept is not acceptable.
Selection of Consultants
The Project will build a database of consultants who will be invited through advertisements to register to provide services under the BDS Fund. These consultants will permit the Fund to offer their (consultants’) name to MSMEs who require support to overcome business challenges.
To establish competence and capability of such consultants to provide the services required by beneficiaries under the Fund; the following steps would be considered for including a consultant in the database:
a. Consultant completes registration form and attaches a short profile of capability to carry out specific assignments (referencing mainly similar assignments undertaken in the past).
b. Completed forms and attachments are received, verified and registered
c. Consultant is approved and included in the database.
d. Consultant is notified of his/her inclusion in database
Payment Procedures
Consulting and related services: Payment for consulting services and other eligible costs rendered under this scheme will be made prior to the commencement of the assignment and upon completion.
Mobilisation of payment
a. After signing the contract, the beneficiary:
§ pays fifteen percent (15%) of the total contract sum by banker’s draft to a designated BDS Fund Bank Account and
§ completes a form authorizing the BDS Fund to pay the amount on the consultant’s invoice
b. Beneficiary sends the original bank payment receipt (together with a photocopy of it) and the consultant’s invoice for 30% of the Contract amount[2]. The Contract reference number will be quoted on all such bank payments (suffixed to the beneficiary’s name)
c. The Grant Manager confirms the receipt of such funds from the daily Bank Statements received from the BDS Fund Bankers and prepares, signs a voucher requesting payment of 30% of the contract sum to the consultant.
d. The Fund Manager countersigns the voucher. The BDS/FM Specialist and Fund Manager then instruct the Bank to transfer the amount to the consultant’s account (in all cases, the contract reference number must be quoted)
Mid-term payment
a. When the programme has reached mid-term (according to a benchmark defined in the proposal), the beneficiary may claim up to half the grant amount by providing:
An Interim Report;
Documentation of the total expenditures and costs to date (i.e., receipts for relevant expenditures, details of staff time and costs);
The consultant’s invoice claiming reimbursement of the documented expenditures/costs, up to 50% of the total grant award.
b. Project Office receives originals of all documents.
c. Quality of the Interim Report is evaluated (physical inspection of the products or service where applicable) against the pilot proposal originally submitted and recommendations made to MSME for NO-OBJECTION.
d. PRAT is completed and signed off to the Grants Manager
e. The Grants Manager checks the invoice(s) and documentation of expenditures/costs and prepares a voucher requesting payment of the approved amount to the beneficiary.
Final payment
a. When the pilot programme has been completed, the beneficiary may claim the remainder of the grant amount by providing:
A Final Report, including evaluation of results and lessons learned in the pilot;
Documentation of the total expenditures and costs (i.e., receipts for relevant expenditures, details of staff time and costs);
The consultant’s invoice claiming reimbursement of the balance of the total grant award, up to 50% of the total documented expenditures/costs.
Procurement Management Systems and Procedures
Procurements under the BDS Fund will mainly be of consulting services by matching grant applicants. Such procurement will be made as follows:
The applicant discusses the business problem needing a solution with the Regional Office and antennae dedicated staff and Project Office developed standardised Terms of Reference for grant assistance.
The applicant will discuss the TOR with at least three consultants and requests for technical and financial proposals to address the identified business problems.
The applicant receives these proposals and selects one based upon cost competitiveness, strength of the methodology and approach, or other aspects of the proposal.
The applicant submits the three proposals together with the completed application form and other required documents to the BDS Fund for evaluation
The Fund approves the application (with the proposal) or recommends it for approval by the Supervisory Board; the Fund Manager then provides a standard grant contract, to be signed between the Applicant, Consultant and Fund Manager for work to commence.
Where the applicant is unable to locate the needed number of consultants, the Fund will locate consultants in its database and offer a set of three qualified consultants to the applicant.
For application forms, please click the applications button
Grant Application Form- For Financial Institutions: PDF Version - Word Version | | Grant Application Form- For Companies: PDF Version - Word Version |
Grant Application Form- For Associations: PDF Version - Word Version | | Service Provider Registration Form: PDF Version - Word Version |
Application Process: PDF Version - Word Version | | BDS Fund Concept Note: PDF Version - Word Version | |
[1] Other than those already participating in the grant-plus-credit programme through the ARB Apex Bank.
[2] This voucher must also be signed by beneficiary’s representative. The Regional Officer will endorse the back of the voucher and write the date of receipt
The BDS Fund is a matching grant scheme which forms part of two large projects:
Grant Application Form- For Financial Institutions: