Real People Investments: Development bank financing sought

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MICROLENDER Real People Investment Holdings is in funding talks with development finance institutions after the collapse of African Bank Investments Limited (Abil) wiped out demand for corporate bonds. “It takes more time and it means more work and there’s probably less bang for your buck,” chief executive Neil Grobbelaar said on Friday. “We can probably go a year without selling a bond. It’s been a tumultuous time and the South African capital markets are going to be a tough place for businesses like ourselves.” African Bank, the country’s largest provider of unsecured loans, had to be rescued by the central bank this month after mounting losses caused investors to withdraw funding. Real People lends to small businesses and individuals who want to renovate homes or educate their children privately. It has sold 30 rand-denominated bonds and Swedish and Norwegian securities since 2011, according to Bloomberg data.”We’re fortunate because we have access to other forms of funding,” Grobbelaar said. “We can prove we have a different quality of customer from Abil and show what the loans are used for.” – Bloomberg

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