The DBSA Project Preparation Fund supports infrastructure projects through funding the preparation of projects that fall short of the needs of both the public and private sector, as in most cases sponsors do not have funding available to prepare projects to investment stage. As a DFI, the DBSA is positioned to take on early-stage risk where commercial banks are reluctant to take on this risk.
Preparation support in this context can be defined as financial support to create capacity and guidance to prepare projects for investment, by the public and private sector or a combination thereof. The DBSA Project Preparation Fund utilises funding from strategic partners and/or 3rd party funds it manages for the more risky, early stage preparation activities and its own funding for late stage projects. This approach allows the DBSA to take unique, catalysing investment positions in order to be able to “crowd-in” 3rd party capital.