CIDB Requirement – Financial Sponsorship

A sponsorship can help a contractor increase their available capital if their current financial statements don’t meet the requirements for the grade they’re applying for. The rules outline what the sponsorship must include and set limits on how much sponsorship a contractor can use to meet the grading requirements.

The sponsorship must be a financial guarantee that can be collected from one person by another. This means the sponsorship must be available as cash that the recipient can actually receive and use.

CISB has decided to set a limit on how much of the Available Capital can be sponsored to meet a grading requirement. This is to reduce the risk of contractors receiving a grade based solely on sponsorship, without having any Available Capital of their own.

Three types of sponsorship will be accepted, namely:

1. A bank overdraft facility in the name of the company applying;
2. An investment facility in the name of a member of the company (not in the name of the company applying);
3. Sponsorship from an affiliate company.

There are specific requirements to be met with these sponsorship requirements. Contact us for more information regarding these requirements.