SayPro Institutional Borrowing Management Policies, Procedures, Processes, Templates, Documents and Forms SayProP570

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Document Code: SayProP570
Approved By: Neftaly Malatjie, Chief Executive Officer
Last Reviewed: 25 April 2025
Next Review Date: 25 October 2025

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𝗕𝗢𝗟𝗗 𝗛𝗘𝗔𝗗𝗜𝗡𝗚𝗦 𝗕𝗘𝗟𝗢𝗪

𝗧𝗜𝗧𝗟𝗘
SayPro Institutional Borrowing Management Procedure

𝗣𝗨𝗥𝗣𝗢𝗦𝗘
To establish clear guidelines and controls for managing institutional borrowing by SayPro. This includes securing and repaying loans or credit facilities in a way that aligns with SayPro’s financial strategy, risk appetite, and regulatory obligations.

𝗦𝗖𝗢𝗣𝗘
This procedure applies to:

• SayPro Royal Directors
• SayPro Chief Officers
• SayPro Finance Division
• SayPro Governance and Compliance Units
• External Lenders or Financial Institutions engaging with SayPro

𝗣𝗢𝗟𝗜𝗖𝗬 𝗦𝗧𝗔𝗧𝗘𝗠𝗘𝗡𝗧
All borrowing activities at SayPro must be authorized in line with governance protocols, transparent, supported by due diligence, and designed to ensure long-term financial sustainability.

𝗔𝗣𝗣𝗥𝗢𝗩𝗔𝗟 𝗛𝗜𝗘𝗥𝗔𝗥𝗖𝗛𝗬
Borrowing proposals must follow this approval chain:

1. SayPro Royal Director – Financial Strategy
2. SayPro Chief Financial Officer (CFO)
3. SayPro Chief Executive Officer (CEO)
4. SayPro Royal (Board) Committee

𝗧𝗬𝗣𝗘𝗦 𝗢𝗙 𝗕𝗢𝗥𝗥𝗢𝗪𝗜𝗡𝗚

• Short-Term Loans (≤ 12 months)
• Long-Term Loans (> 12 months)
• Asset-Based Financing
• Revolving Credit Facilities
• Grants or Conditional Institutional Advances

𝗣𝗥𝗢𝗖𝗘𝗦𝗦 𝗙𝗟𝗢𝗪

Step 1: Needs Assessment

• Prepared by SayPro Finance Division
• Includes cash flow forecasts and justifications

Step 2: Proposal Submission

• Presented by SayPro Royal Director – Financial Strategy
• Reviewed by CFO and Legal Team

Step 3: Risk & Compliance Review

• Governance and Compliance Unit conducts due diligence
• External risk consultants may be involved if needed

Step 4: Executive Approval

• CFO and CEO must co-sign financial proposal

Step 5: Board Authorization

• Royal (Board) Committee gives final go-ahead

Step 6: Engagement with Lender

• SayPro negotiates terms with selected financial institution
• Legal agreements must be signed by CFO and CEO

Step 7: Monitoring and Reporting

• SayPro Finance Division to produce quarterly loan performance and repayment reports
• Reports submitted to Royal (Board) Committee

𝗥𝗢𝗟𝗘𝗦 & 𝗥𝗘𝗦𝗣𝗢𝗡𝗦𝗜𝗕𝗜𝗟𝗜𝗧𝗜𝗘𝗦

SayPro Chief Financial Officer (CFO)

• Leads all institutional borrowing processes
• Ensures repayment planning and financial impact analysis

SayPro Royal Director – Financial Strategy

• Prepares and presents initial funding proposals
• Monitors financial outcomes post-borrowing

SayPro Governance & Compliance Unit

• Validates regulatory and policy compliance
• Oversees documentation and legal frameworks

SayPro CEO

• Signs off on strategic borrowing aligned with institutional goals

𝗗𝗢𝗖𝗨𝗠𝗘𝗡𝗧𝗔𝗧𝗜𝗢𝗡 & 𝗥𝗘𝗖𝗢𝗥𝗗𝗞𝗘𝗘𝗣𝗜𝗡𝗚
All borrowing-related documentation must be archived in the SayPro Secure Finance Repository for a minimum of 10 years.

𝗧𝗘𝗠𝗣𝗟𝗔𝗧𝗘𝗦 & 𝗙𝗢𝗥𝗠𝗦

• SayPro Institutional Borrowing Request Form (SayProF570-01)
• SayPro Due Diligence Checklist (SayProF570-02)
• SayPro Loan Agreement Template (SayProF570-03)
• SayPro Board Approval Resolution Template (SayProF570-04)

𝗖𝗢𝗠𝗣𝗟𝗜𝗔𝗡𝗖𝗘
Non-compliance with this procedure may result in disciplinary action, financial review, or termination of authority for financial transactions.

𝗥𝗘𝗩𝗜𝗘𝗪 & 𝗔𝗠𝗘𝗡𝗗𝗠𝗘𝗡𝗧
This procedure must be reviewed every six (6) months by the SayPro Governance Unit in collaboration with the CFO.

𝗙𝗔𝗤𝗦

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𝗤: What happens if borrowing is initiated without proper authorization?
𝗔: Unauthorized borrowing is considered a serious breach and may lead to disciplinary action, contract termination, or legal consequences.

𝗤: Who is allowed to initiate an institutional borrowing request at SayPro?
𝗔: Only the SayPro Royal Director – Financial Strategy, in collaboration with the CFO, can initiate borrowing requests.

𝗤: What is the minimum amount that requires SayPro Royal (Board) Committee approval?
𝗔: Any borrowing above R1,000,000 requires Royal (Board) Committee review and formal resolution.

𝗤: Can SayPro borrow from international financial institutions?
𝗔: Yes, provided all regulatory, legal, and compliance requirements are met, and approval is granted by the CEO and Royal (Board) Committee.

𝗤: Is collateral required for institutional borrowing?
𝗔: Collateral may be required depending on the lender’s requirements. All collateral proposals must be reviewed by the Legal and Governance Units.

𝗤: How often are borrowing contracts reviewed?
𝗔: Borrowing contracts are reviewed semi-annually by the Finance and Governance Units.

𝗤: Who negotiates the borrowing terms with the lender?
𝗔: The CFO leads negotiations, supported by the Legal Team and the Royal Director – Financial Strategy.

𝗤: What is the role of the Governance Unit in the borrowing process?
𝗔: To ensure that borrowing activities comply with internal policies, legal requirements, and ethical standards.

𝗤: What if a loan repayment deadline is missed?
𝗔: The CFO must notify the CEO immediately. A recovery and mitigation plan must be activated and reported to the Royal (Board) Committee.

𝗤: Are there limitations on the type of loans SayPro can obtain?
𝗔: Yes, SayPro is restricted from entering high-risk or speculative loan agreements, including unsecured, volatile, or predatory loans.

𝗤: Can SayPro repay a loan early?
𝗔: Yes, subject to the terms of the loan agreement. Early repayment must be approved by the CFO and documented accordingly.

𝗤: Who signs the final loan agreement?
𝗔: The CFO and CEO must both sign the final borrowing agreement, after legal review and Royal (Board) Committee approval.

𝗤: Are grants or donor-based loans treated differently?
𝗔: Yes, grants with repayment obligations are reviewed under this procedure, but donor reporting standards also apply.

𝗤: How is loan utilization monitored post-disbursement?
𝗔: The Finance Division prepares quarterly utilization and repayment reports submitted to the Royal (Board) Committee.

𝗤: Can borrowing be used to pay staff salaries?
𝗔: Only under exceptional circumstances and with specific Board approval. Borrowing should support strategic growth or investment.

𝗤: What is the procedure if a lender offers poor or unfavorable terms?
𝗔: The CFO must reject the proposal and notify the Royal (Board) Committee with reasons and recommendations for alternatives.

𝗤: Is SayPro allowed to refinance existing debt?
𝗔: Yes, refinancing is permitted with full analysis, strategic justification, and approval by the Royal (Board) Committee.

𝗤: Can SayPro borrow in foreign currency?
𝗔: Yes, but exchange rate risk analysis and compliance with South African Reserve Bank regulations must be conducted beforehand.

𝗤: Are independent auditors involved in institutional borrowing?
𝗔: Yes, all significant borrowings are audited annually for compliance and financial risk exposure.

𝗤: What templates must be used during the borrowing process?
𝗔: The SayProF570-01 Borrowing Request Form, SayProF570-02 Due Diligence Checklist, and SayProF570-04 Board Resolution Template are mandatory.