Part 4 of 10 · Exclusions
What NYDA Grant Money Can and Cannot Buy
This is the fastest way to find out whether your plan is fundable. One item from the wrong column ends the application no matter how good everything else is.
Chapter 6The fundable and the excluded
Check every line of your intended spending against the right-hand column before you write anything down.
The vehicle rule
It deserves its own heading because it catches so many people. The NYDA will not fund vehicles. Not a bakkie, not a delivery van, not a taxi. If your entire growth plan is built on getting a vehicle, the grant will not deliver it and you need to plan around that now rather than discovering it at due diligence.
There are ways to work with this. Some businesses fund the equipment that goes into a vehicle they already have. Some restructure around a delivery partner rather than owning transport. Some go to an asset finance provider for the vehicle and use the grant for the working capital around it — though note that the grant cannot be used as a deposit for someone else’s loan either.
The other exclusions worth knowing
| Category | What is excluded |
|---|---|
| Your sector | Gambling and gaming for money, pyramid schemes, loan sharking, the sex industry, anything illegal, and tobacco or alcohol as your main source of income. |
| What you buy | Vehicles. Second-hand equipment, unless it is industrial equipment with at least five years of life left. |
| Paying off things | Existing loans, replacing another lender, a deposit towards someone else’s loan, overdue SARS debt, or a bribe. |
| Early-stage innovation | Prototyping (except cell phone app development), research and development seed capital, patent registration, and buying exclusive distribution rights. |
| Your entity | Investment trusts, venture capital and private equity funds. |
| Your history | Still owing the NYDA, having had an NYDA loan written off, a fraud conviction or record of fraud or corruption, being an un-rehabilitated insolvent, or still being at high school. NYDA staff and Board members cannot apply. |
| Leaving a funded business | If you resign from a business the NYDA funded, you must wait two years from your resignation date before applying again. |
If you have an idea rather than a business
Read the innovation line above carefully. Prototyping and research and development are excluded, which means that if you are pre-revenue with a product you are still developing, the NYDA grant is structurally the wrong instrument — even though agriculture and technology projects carry a higher ceiling.
That is not a dead end. It means your route is innovation-specific funding, incubators and competitions rather than the NYDA grant. Part 9 points you in the right direction.
Threshold 1 does exist for idea-stage and survivalist businesses, at R1 000 to R10 000. But it is aimed at someone starting to trade — buying a first batch of stock or a set of tools — not at someone developing a product that does not yet exist.
