Questions and answers concerning investments that can be financed; what cannot be financed; who can obtain financing; minimum requirements to apply for financing; the flow of operations; and the BNDES’ support policies.
1. What are the investments financed by the BNDES?
Investments for implementing, expanding, modernizing, increasing and recovering companies’ production capacity, including the acquisition of new Brazilian-produced machinery and equipment, accredited by the BNDES, and the working capital associated to an investment project.
2. What cannot be financed?
The economic sectors that cannot receive support from the BNDES are: banking/financing activities; arms trading; motels, saunas and clinics for adult entertainment; gambling and the likes. The BNDES does not finance the acquisition of land and real estate, nor does it swap assets.
3. Who can obtain financing from the BNDES?
Private companies of any size, with headquarters and administration set up in Brazil, and individual businesspersons. Public Administration and individuals are also financed, in specific cases.
4. Does the BNDES finance foreign companies?
Yes, foreign companies with headquarters and administration set up in Brazil. Brazilian companies with controlling capital in the country or abroad may be financed by the BNDES.
The only case in which the BNDES may support a company with headquarters and administration overseas is in the buyer’s credit modality, through post-shipment export lines and programs, earmarked for commercializing goods produced in Brazil, outside the country.
Refer to: BNDES Exim Post-Shipment.
5. Where can I get information on investments of foreign companies in Brazil?
We suggest consulting the page of the Brazilian Trade and Investment Promotion Agency - Apex Brazil.
6. Which are the minimum requirements to request financing through the BNDES’ resources?
7. Does the BNDES require investors to use any of own their resources in the financed undertaking?
Yes. As a rule, financing through the BNDES’ resources requires entrepreneurs to contribute a part of the investment.
8. What are the specific cases when the BNDES finances individuals?
Individuals that may receive financing from the BNDES are farmers, autonomous cargo transporters and Brazilian micro-entrepreneurs.
In establishing financial conditions, individuals are treated the same as micro, small and medium-sized companies (MPMEs).
9. Does the BNDES finance the export of goods produced in Brazil?
Yes. The BNDES finances the export of goods produced in Brazil, which are on the list of eligible products, through the Bank’s credit products known as BNDES Exim Pre-shipment and BNDES Exim Post-shipment.
Trading Companies or Commercial Exporters may also access BNDES Exim Pre-shipment. Operations are carried out through financing institutions accredited by the BNDES.
10. Does the BNDES finance the acquisition of machinery and equipment manufactured outside Brazil?
The BNDES finances the acquisition of new machinery and equipment produced outside Brazil only when similar products are not manufactured in the country.
11. Does the BNDES finance the import of machinery and equipment manufactured in Brazil by foreign companies?
Yes. The BNDES may support a foreign company through the buyer’s credit modality, through the Bank’s lines and programs for post-shipment export.
Refer to: BNDES Exim Post-shipment.
12. Does the BNDES finance working capital?
The BNDES finances working capital separately, through a specific program. It is usually associated with an investment project, as part of the project, or with the acquisition of machinery and equipment through the Bank’s products.
13. Does the BNDES carry out non reimbursable/unrecoverable operations?
Operations may be carried out without the required reimbursement to the BNDES for investments of a social, cultural, environmental, scientific or technologic nature.
14. How is financing carried out with the BNDES’ resources?
Financing operations may be directly contracted at the BNDES and/or the accredited financing institutions, which operate as on-lenders of the Bank’s resources.
15. What financing operations are carried out directly with the BNDES?
Investment projects in which the financing value is at least R$ 10 million can be carried out directly with the BNDES. The minimum financing value may vary, at the discretion of the BNDES, according to the operating areas.
Some financing programs may be supported directly by the BNDES; in this case a minimum value is established for the direct support.
16. Which financing operations are carried out only through accredited financing institutions?
17. Which accredited financing institutions are on-lenders of the BNDES’ resources?
In Brazil, commercial banks, cooperative banks, multiple banks, development banks, investment banks and fomentation agencies, public or private, are accredited to operate with the on-lending of the BNDES’ financing lines.
The BNDES’ partnership with the accredited financing institutions helps disseminate credit and facilitates financing for micro, small and medium-sized companies in all Brazilian cities.
Financing institutions abroad are admitted as guarantors for operations that support the commercialization of national goods and services abroad, in the post-shipment phase.
18. Does the BNDES carry out risk capital operations?
BNDESPAR, the integral subsidiary of the BNDES, follows the strategic guidelines formulated together with the BNDES aimed at supporting the capitalization process and developing Brazilian companies. BNDESPAR operates mainly through corporate interest (stakes) of a minority and transitory nature, typically around 1/3 of the investing party’s capital, aiming at offering financing support to Brazilian companies in the form of risk capital and, simultaneously, strengthening and modernizing the securities market.
19. How are the BNDES’ resources applied in corporate interests (stakes)?
The BNDES may participate, as a subscriber of bonds and/or securities, in publicly traded companies, in public or private issuances or in companies that, in the short or mid-term, may enter into the capitals market, through a private issuance. The following are considered bonds and securities: shares; simple debentures; convertible debentures or exchangeable for shares; subscription bonus; options and other derivative products; quotas of private mutual funds; and quotas of credit receivables funds (FIDC).
20. Does the BNDES monitor the application of the resources in a financed project?
Yes. In the undertakings directly financed by the BNDES, a systematic follow-up on the physical and financial performance is carried out, in accordance with the approved project. The transfer of resources from other sources is also validated, as well as the performance indicators of the company carrying out the project and of the corporate group it belongs to.
In the case of indirect operations, follow-up is carried out by the accredited financing institution that operationalized financing.
21. If a beneficiary does not prove the physical-financial performance of the financed project, and applies resources to a purpose other than that established in the formalized operational instrument, can they be penalized?
Yes. In this case, the maturity date of the contract will be brought forward and the client will be subject to a 50% fine on the disbursed value without proof, along with added charges established in the contract until the debt is quitted.
22. What is the flow of financing operations that are contracted at the BNDES?
Requests for financial support are sent to the BNDES through a Consultation Letter – filled in according to the guidelines in the specific guide - and sent by the interested company or through the accredited financing institution of its preference.
Consultations are the businesspersons’ first step to receiving financing through the BNDES. In the consultation letter, the basic characteristics of the company and the project are specified, which are needed to establish the eligibility of the operation in the BNDES’ Operational Policies.
Requests for financing, from the moment the request arrives until the contract is drawn up to release the resources, have procedural deadlines.
Refer to: Analysis Process and Selection of Projects.
23. What are the social and environmental policies of the BNDES?
The BNDES understands that its role to advance Brazil’s development is intimately linked to fostering economic development on a sustainable basis. With that purpose, it aims to generate and stimulate positive social and economic impacts on all its fronts. Besides investing in initiatives with palpable social benefits as well as environmental preservation projects, the BNDES respects and attaches great importance to social and environmental principles when granting loans.
The main purpose of the Social and Environmental Policy of the BNDES is to proactively foster sustainable development in all undertakings supported, through an integrated concept of the economic, social, environmental and regional scopes.
The Bank also has a Social and Environmental Responsibility Policy, which establishes principles and guidelines for developing and implementing sustainable policies and practices in all its activities as well as in its relationships with its various stakeholders.
24. Does the BNDES finance environmental projects?
In undertakings in any sector, investments aiming at environmental preservation may be financed. The BNDES and the accredited financing institutions, when analyzing any given project, verify its environmental impact, establishing conditions, when approving a request, on the performance of investments for environmental preservation.
In financed projects, the provisions on the environment in the Organic Law of a respective city, the legislation on use of the soil and on the preservation areas, eco-tourism and leisure must be respected. In addition, the project must define the use of sewerage treatment plants or municipal garbage collection networks, as well as the procedure for waste disposal, giving preference to selective garbage collection and recycling.
25. Does the BNDES support projects in energy efficiency?
Support for projects in energy efficiency may be granted to companies working with power conservation services, to final users of energy and to companies that generate, transmit and distribute power.
Projects should prove their contribution to saving power, the increase in the global efficiency of the power system or the replacement of fossil fuels with renewable sources.
26. Does the BNDES finance reforesting?
Agricultural, cattle-raising, agroindustrial and industrial projects that plan to invest in reforesting may be financed. Support for reforesting is conditioned to a sustainable management program and to reforesting with natives trees, including for those undertakings that aim at internally commercializing as well as exporting native wood. In forest projects, specific legislation from the environmental regulation institutes must be complied with.
27. What is BNDES’ policy to support Innovation?
The BNDES’ support policy for innovation is aimed at promoting and financing investment projects associated with capacity building and establishing innovative environments, focusing on attaining better competitive positioning for Brazilian companies, as well as contributing to the increase of innovative activities in the country and to their systematic development.
Operations must: (i) encourage the development and expansion of the production and innovative capacities of the production clusters and systems that exist in the country, within the scope of consistency and sustainability; (ii) prioritize the production and innovative clusters and systems that reinforce the dynamic Brazilian competitiveness while mobilizing social development; and (iii) promote new opportunities to develop innovative production clusters and systems for the future.