RFQ funding
You quoted. You won. Now the supplier wants paying before the department pays you. Funding placed against an awarded request for quotation — the route most government work under R1 million actually comes through.
Most government work is not a tender
Businesses chase tenders because that is the word everyone uses. In practice the majority of government orders placed with small suppliers never go out as a tender at all. They go out as a request for quotation, they are awarded in days rather than months, and they repeat.
A request for quotation — an RFQ, sometimes called a quotation, an RFQ 7.3 or simply “a quote” — is how an organ of state buys goods and services below the tender threshold. You are invited to quote, the department compares quotes, and the winner receives a purchase order or letter of appointment. That award is what we fund.
Where an RFQ sits in government procurement
National Treasury sets the thresholds that decide which route a department must use. Under SCM Instruction 02 of 2021/22, which applies to institutions governed by the Public Finance Management Act:
| Value of the requirement | How the department must buy | Can it be funded? |
|---|---|---|
| Up to R2,000 | Petty cash or a single written quotation. Small, immediate purchases. | Too small — the funding cost would exceed the margin. |
| Above R2,000 to R1,000,000 | Request for quotation. Quotes invited from suppliers registered on the Central Supplier Database. | Yes, once awarded — this is RFQ funding. |
| Above R1,000,000 | Competitive bidding. An advertised tender, with a bid committee process. | Yes, once awarded — see tender finance. |
The practical consequence: if your business turns over a few million rand a year supplying government, most of what you win will arrive as RFQ awards, not tenders. The funding question is the same either way, and so is the answer.
Quoted is not awarded
This is the single thing people get wrong, and it is worth being blunt about. A quotation you have submitted and are waiting on cannot be funded. Not by us, not by anyone legitimate. There is no asset yet — only a hope. A funder lending against it would be lending against nothing.
The line is not RFQ versus tender versus purchase order. It is awarded versus not awarded. The day a written award arrives, the same deal that was unfundable the day before becomes placeable.
If someone offers to fund your quote before you have won it, or asks for a fee to “secure” funding at quote stage, walk away. There is no such product.
What an award looks like on paper
Any one of these, in writing, from the institution itself:
- A purchase order. The most common outcome of a won RFQ. It carries an order number, the line items, the value and the delivery date.
- A letter of appointment or acceptance. Common on services and on framework-style awards where orders follow later.
- A signed service level agreement or contract, where the RFQ led to one.
- A written award notification naming you as the successful supplier, followed by the order.
What does not count: a screenshot of a portal listing, a verbal from a procurement officer, a bid number, or an email saying your quote is “being processed”. If you are unsure what you are holding, send it over and we will tell you.
RFQ funding, tender finance and purchase order funding
Three names, one mechanism. The differences are real but smaller than the vocabulary suggests.
| RFQ funding | Tender finance | Purchase order funding | |
|---|---|---|---|
| Where the award comes from | Government, below the tender threshold | Government, above the tender threshold | Any buyer, usually private |
| Typical size | R20,000 – R1 million | R1 million and up | R20,000 and up |
| Typical award time | Days to a few weeks | Months | Immediate — the order is the award |
| Assessed on | The department, the margin, your capacity | The department, the margin, your capacity | The buyer, the margin, your capacity |
| Deed of cession usually required | Yes | Yes | Sometimes |
| Main risk to you | How late the department pays | How late the department pays | Whether the buyer pays at all |
You have to be on the CSD
Institutions procuring under the PFMA must buy from suppliers registered on the Central Supplier Database. No CSD registration, no RFQ invitation, no award, nothing to fund. Your tax compliance status and banking details are verified through it, so a lapsed tax clearance quietly removes you from consideration without anybody telling you.
If you are not registered, or your registration has gone stale, that is fixable — we do CSD and CIPC registration as a separate service. It is not funding, but it is the groundwork that makes funding possible.
A warning. We will ask you to download your CSD report and send us the file. We will never ask for your CSD username and password, and nor should anyone else. See how we handle your documents.
When RFQ funding does not work
The conditions are the same as on any award-backed deal, and they are set out in full with the numbers on what has to be true. In short:
- Not awarded yet. Covered above. Come back the day it lands.
- Margin under about 10% gross. There is not enough in the deal to carry the funding cost and still leave you a profit. Between 10% and 20% it is placeable but the panel narrows; 20% and up is where most funders compete for it.
- The department will not sign a deed of cession. On government work this is usually a condition. Ask your buyer early, not at the end.
- Pure labour with no supplier invoice. Harder, because there is no goods purchase to fund. Not always a no — tell us the structure.
- A delivery well beyond anything you have done. Expect hard questions about capacity. Sometimes the right answer is to fund part of it.
What it costs
Pricing on an RFQ award is built the same way as any award-backed facility: who is paying you, how long the money is out, and the margin in the deal. Work out roughly where you sit before you speak to anyone.
What moves the price
Who is paying you
The strongest driver by far. A national department and a small private buyer are priced completely differently, because the funder is really lending against them.
How long the money is out
Cost accrues over the funding period. An order delivered in three weeks and paid in thirty days costs a fraction of one that runs six months.
Your gross margin
Under about 20% there is little room for the cost of funding. Above 30% the deal carries it comfortably and more funders will compete for it.
Whether you have done it before
A repeat order for a buyer you have delivered to prices better than a first contract in a new sector.
An illustration, not a quote
How the numbers tend to work
Invented figures, to show the shape of a deal. Your actual cost comes from the funder in writing, and you see it before you commit to anything.
- Order you have been awarded
- R500,000
- What it costs you to deliver
- R375,000
- Your gross margin
- R125,000 · 25%
- Funded by the facility
- R375,000
- Cost of the finance
- a share of the margin
- What you keep
- the rest of it
Most tender and purchase-order funding in South Africa is priced either as a fee on the amount advanced or as a share of the profit on the deal, settled when your client pays. There is no published rate card anywhere in this market — including ours — because the price genuinely depends on the four things on the left. What we will not do is let you find out the number only after you have committed.
What it costs
Two separate things: what the lender charges for the money, and what we charge for placing it. Both below.
FEES at the top of gen.py and rebuild.| What | How much | On what basis | When |
|---|---|---|---|
| Eligibility check and first conversation | No charge | Free in every case, including when we tell you we cannot place the deal. | Never payable. |
| Funder commission | 1% – 5% of the amount advanced | Paid to us by the funder once your facility is drawn. Not deducted from your advance. We tell you the figure on your deal before you sign. | On drawdown, by the funder. |
| Broker / origination fee | 1% – 5% of the facility | Charged to you only where no funder commission is available on the route that suits you, or where the work is heavy relative to the deal size. | On drawdown. Never up front. |
| Company registration and compliance work | not yet set | Quoted as a fixed price in writing before any work starts. | On instruction. |
How we are paid, in full — including what we do about the conflict of interest that commission creates.
How late will the department actually pay?
Government is required to settle supplier invoices within thirty days. National Treasury publishes, every quarter, how well each province manages that. In the quarter to September 2025 there were 92,223 invoices still unpaid past the deadline across the provincial administrations, worth R12.1 billion.
It is not evenly spread. Eastern Cape alone accounted for 46,583 of them, while Limpopo had none at all. On an RFQ award the department’s payment record is not a detail — it is most of what decides whether the deal is worth doing at your quoted price.
Look up your buyer’s payment record before you quote, not after you have won.
What you need to apply
- The award: the purchase order, letter of appointment or signed contract
- The RFQ document you quoted against, if you still have it
- Your supplier’s quotation or pro-forma invoice
- Six months of business bank statements
- Company registration documents, the director’s ID and your CSD report
If you are missing something, send what you have. We would rather start the conversation than wait for a perfect file.
Won an RFQ you cannot fund?
Tell us which department awarded it and what it is worth. We will tell you honestly whether it is placeable.