Africa in need of asset financing


“We feel that on the African continent, from a general point of view, there is a need for financing of assets, and because of the tremendous growth we’re seeing in Africa, quite a few worldwide brands are looking at ways to sell their products with a financing solution attached to them in Africa,” Dölberg Finance chief executive, Kamil Patel, told CNBC Africa.

“Dölberg specialises in the financing of corporates. We’ve been working on finding a product that’s ideal for Africa and it seems that a rental product for these assets in Africa is perfect because it’s truly off-balance sheet financing.”

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According to Patel, this brings with it a lot of advantages, especially those regarding speed and efficiency.

“We bring advantages with tax where if you do a rental agreement, the depreciation doesn’t stay on the books of the client but on the books of the renter,” he said.

“There are also VAT issues – if it is done through a rental company, we come in [and] take that burden. It’s not the problem of the client anymore.”

The Mauritius-based financial support provider has also reportedly signed a significant deal in South Africa regarding the financing of business process and document management company, Xerox’s expansion in several African countries.

“We’ve been chatting with one of the biggest IT software companies in Africa and the discussion has started, it’s happening,” Patel said.

“There is a mix of products that are being sold in Africa and with all the brands, we see very high quality setups in Africa. Unfortunately, there is an image of Africa being underdeveloped, which is sometimes unfair.”

Patel indicated that Dölberg, which provides asset finance, finance leases and rentals, secured loans and trade finance, has also experienced a number of geographical advantages.

“There’s a few advantages in leasing – leasing has existed for about 30 years in Mauritius, we’re very high on the curve with experience, we’ve got a very good workforce in Mauritius,” he said.

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“Mauritius is a fantastic platform to work from. The regulations and the double taxation agreements with the African continent makes it interesting for us to work from here.”