The financing plan: contribution, loan, subsidy — the order in which resources go in

1. Who actually requires a financing plan, and who does not?

The term does appear in the official texts — but never with the same content twice, and never with a line for a subsidy. Four documents, four nomenclatures. That is why the same project circulates with three different sets of figures.

Investment registration asks for none. Executive decree no. 22-299 of 8 September 2022 lists the documents making up the file: the application form in annex (I) together with the list of goods and services (article 3); the investor's identity document — plus, for an extension, the commercial register extract, the tax identification number and the last closed financial year's tax balance sheet (article 6) —; and a techno-economic study for structuring investments only (article 7). The annex (I) form asks only for two declared figures: the "Montant d'investissement prévisionnel (en KDA)" (forecast investment amount, in thousands of dinars) at point 8, and the "Montant des apports en fonds propres (KDA)" (own-funds contribution) at point 9, split between cash and contributions in kind. The eleven forms the Agency publishes for this regime — registration application, lists of goods and services, list of contributions in kind, power of attorney, project progress statements — include no financing-plan template at all.

The model techno-economic study names one, with three headings. Annex (V) to executive decree no. 26-154 of 14 April 2026 (Official Journal no. 31 of 2026, page 26) devotes its part V to the "Plan d'investissement" (investment plan), whose point 3 is named "3. Plan de financement" and contains exactly three bullets: "Apports en fonds propres" (own-funds contributions), "Crédits bancaires" (bank loans), "Partenariats" (partnerships). Its point V.1, "Investissement initial" (initial investment), contains four: equipment, buildings, "Ingénierie / montage" (engineering and assembly), and "Fonds de roulement" (working capital).

The land concession terms of reference name one, with two bullets. Annex IV to the same decree (pages 20 to 25) opens its article 17, "Capacités financières" (financial capacity, pages 23-24), with this sentence: "Le plan de financement du projet d'investissement envisagé, tel que défini par l'article 14 ci-dessus, se présente comme suit" — then a total project cost, a three-column "Structure de l'investissement" table (item, amount in millions of DA, percentage) covering preliminary costs, buildings, production equipment and ancillary equipment, and finally a "Schémas de financement du projet" section reduced to two bullets: own-funds contributions as a percentage, bank loans as a percentage.

The bank turns it into a named document. The investment credit file published by BNA lists, among the accounting and financial documents, a "Plan de financement de l'investissement", alongside a "facture pro-forma et/ou contrat d'achat d'équipements récent (moins de trois (03) mois)" (pro-forma invoice or purchase contract less than three months old) and a valuation by an approved expert for any contribution in kind. The list CPA publishes for corporate investment credit likewise requires, at its point 11, a "Plan de financement prévisionnel sur la période du crédit" (forecast financing plan over the term of the loan).

Two lessons, and neither is cosmetic. First, no official nomenclature provides a line for a subsidy or an interest-free loan. The model study does have a third heading, but it is called "partnerships" — a third party's contribution, not public aid. Second, there is a divergence inside the very same decree: annex (V) places working capital within the initial investment, while the annex IV table gives it no heading at all. That is precisely the line that most often disappears from the plans we rebuild.

The practical consequence: the most demanding document is the bank's, so that is the one to build first. The other three are extracted from it; the reverse does not work.

2. In what order do the resources go in?

A financing plan is a two-column table whose sides must match: uses — what the project costs — and resources — the money that covers them. The equality is not an end-of-process check: it is the constraint that imposes the order.

No legal text sets that order. This is a field observation, not a rule of law: in the practice we observe at the firm, the plans that get through are built in this sequence, because each resource conditions the next.

Leasing deserves a separate mention: it appears neither in uses nor in resources, since the asset is not acquired. It removes a line from the uses and turns it into an operating charge — which lightens the financing plan and weighs on the forecast income statement.

The amounts above are example values, chosen to illustrate how the table balances. They are neither a sector benchmark nor a recommended structure.

3. How much own contribution do you need before applying for the loan?

No general text sets a minimum contribution rate for an investment credit: neither the list of documents published by BNA nor article 17 of the concession terms of reference states a minimum percentage. This negative statement is strictly bounded to the texts and documents actually read for this article and does not extend beyond them.

The public schemes, by contrast, publish their rates, and they are instructive because they show how the contribution governs everything else. The official NESDA portal sets out its financing formulas for a project of up to 10,000,000 DA (figures read on the portal in November 2026):

Two readings emerge. First, the bank's share is a constant 70% across all the triangular formulas: what varies is how the remaining 30% is split between the contribution and the interest-free loan. Second, the scheme adds complementary interest-free loans — up to 500,000 DA for the rent of premises or a port site, and only where a bank loan is applied for at the time the activity is created, and up to 1,000,000 DA for exceptional operating needs.

Based on our own assignments, and outside the public schemes, a stated contribution below a fifth of the project cost almost always forces the file to be strengthened elsewhere — guarantee, pledge, or a narrower project scope. This is an observation of practice, not a regulatory threshold.

Careful: the grids differ between schemes, and sometimes between official sources. For ANADE credit, a public bank publishes a markedly different grid: a personal contribution of 1% of the total amount where the investment does not exceed 5,000,000 DA and 2% between 5,000,000 and 10,000,000 DA, interest-free financing of 28% to 29%, a bank share that "ne peut en aucun cas être supérieure à 70% du coût du projet" (may in no case exceed 70% of the project cost), a rate of 6.75% fully subsidised, and an eight-year loan with three years of deferred principal. Both grids coexist on official sources. So check the grid of the scheme actually being applied — do not apply the first one you find.

4. Is a subsidy or an interest-free loan equity or debt?

The accounting answer is clear, and it is surprising: a subsidy is neither. The order of 26 July 2008 setting the valuation and accounting rules of the Algerian financial accounting system defines public subsidies as "transferts de ressources publiques" (transfers of public resources) intended to compensate costs borne, or to be borne, by the beneficiary (§ 124-1). For those financing a depreciable asset, the balance sheet presents them as deferred income — not as equity (§ 124-2).

The rest of the section follows from that, and each point has a direct effect on the forecasts:

• the subsidy is taken to income at the same pace as the costs it compensates: for a depreciable fixed asset, at the pace of the depreciation charge (§ 124-2);
• a subsidy that finances no future cost is recognised as income at the date it is acquired (§ 124-3);
• on a non-depreciable fixed asset, the recognition is spread over the period during which the asset cannot be disposed of, or, absent such a clause, over ten years on a straight-line basis (§ 124-4);
• it is recognised only if the entity complies with the conditions attached and if receipt is reasonably assured (§ 124-5);
• a repayment is treated as a change in estimate: it is charged first against unamortised deferred income, with any excess going to expenses (§ 124-6).

The chart of accounts confirms it beyond doubt. Account 13 is entitled "Produits et charges différés — hors cycle d'exploitation" (deferred income and charges, outside the operating cycle), and it is the account carrying sub-accounts 131 "Subventions d'équipement" (capital grants) and 132 "Autres subventions d'investissements". Neither belongs to account 10, "Capital, réserves et assimilés", nor to account 16, "Emprunts et dettes assimilés". In the model balance sheet, a subsidy therefore does not appear in total equity: it is carried under non-current liabilities, in the "Provisions et produits constatés d'avance" line. And the portion recognised each year passes through account 754, "Quotes-parts de subventions d'investissement virées au résultat de l'exercice".

§ 124-5 is the one that pushes financing plans back: a hoped-for grant is not a resource. Until the decision is notified, the line is an intention, and the bank reads it as a hole.

An interest-free loan, on the other hand, is unambiguous: it is debt, repayable, whose only advantage is that it carries no interest. It belongs on the resources side, but it must appear in the repayment schedule of the forecasts — a frequent omission, because the absence of interest makes it look like equity.

5. Is an FGAR or CGCI guarantee a resource in the financing plan?

No — and the confusion is expensive. A guarantee puts no dinar into the project: it reduces the lender's loss in the event of default. It is negotiated after the financing plan closes, not in order to close it.

The conditions published by the two bodies make this plain, and they do not overlap.

Three consequences for the resources table. First, the guaranteed percentage does not replace the contribution: it applies to the loan, once its amount has been fixed. Second, the cost of the guarantee is a use, to be entered under preliminary costs, and it is not symbolic. Third, you cannot stack two guarantees on the same loan: CGCI expressly excludes projects already covered by another financial guarantee for the same facility — so a choice has to be made, and it is made on the percentage and on the cost.

Two eligibility restrictions to know before building a plan on a CGCI guarantee: commercial activities, agriculture and fishing are excluded, as are enterprises with unpaid loans under the ANSEJ, CNAC or ANGEM schemes. And the FGAR sequencing point still stands: its definitive guarantee arrives only after the bank's approval. The financing plan must therefore stand up without it at the moment it is lodged.

6. What makes a financing plan come back?

What follows is observed practice at the firm, on techno-economic study and financing files. These are not rules of law, and no text states them.

• The start-up working capital requirement is missing. The plan balances the physical investment, and the company finds itself without cash in the first month of operation. It is the single most frequent defect we correct — even though the model study in annex (V) places it in the initial investment in black and white.
• A grant not yet notified is carried as a resource. It is read as missing financing — and § 124-5 of the financial accounting system in any case prohibits recognising it in that state.
• The interest-free loan does not appear in the repayment schedule. It is treated as equity because it carries no interest; the cash-flow plan then becomes wrong at maturity.
• File and guarantee fees are nowhere to be found. Commissions, deed costs, valuations: they are real, and they do not finance themselves.
• The contribution is stated but cannot be mobilised. A contribution in kind with no valuation by an approved expert does not survive the list of documents published by the bank.
• VAT is forgotten on items outside the exemption. Not all of a project's goods benefit from the incentives, and annex (I) of decree 22-299 specifically asks that goods benefiting from the tax advantages be distinguished from those that do not.

One last, more structural point: in our experience, a financing plan is never rejected for being merely unbalanced — it is rejected because one of its lines does not survive the question "which document does this figure rest on?". It is the same requirement as for the equipment list, which is why the two documents are built together.

FAQ — Frequently asked questions

BENSAID Farouk

Financial & Economic Research Consultant — ProfitPilot NextGen Consulting

Certified sole trader and expert in financial studies, risk analysis and market research for SMEs, startups and investors in Algeria. View full profile