The Youth Enterprise Development Fund firm has stepped up training and awareness campaigns to increase loan uptake by young entrepreneurs. [Photo: file, Standard]
The Government plans to speed up processing of loans under the Youth Enterprise Development Fund (YEDF) as uptake remains well below target.
Data shows the fund, started 11 years ago to offer loans to small-scale businesses, has lent out only Sh11 billion to one million youth across the 47 counties.
YEDF Chief Executive Josiah Moriasi says the number of beneficiaries is negligible, reinforcing the need to conduct more training to create awareness among the youth.
“So far, YEDF has given out Sh11,855,137,103 billion through its diverse loan products scheme, thus benefiting close to one million youth,” he said in Kisumu during a training for targeted beneficiaries of the loans.
The training will be rolled out across the seven sub-counties in Kisumu as part of the initiative by the Government to increase disbursements ahead of the August 8 General Election.
Fund Chairman Ronald Osumba told Weekend Business that they were ready to speed up issuance of loans to various women and youth groups.
“We will make sure that applications are processed within 24 hours as opposed to the past where it took more than a month before the loans were approved and disbursed,” he said.
Mr Osumba appealed to the youth to take advantage of the existing State loans facilities for business.
There have been complaints from youth groups that processing of the loans took too long due to bureaucratic impediments in the Government, but the fund’s CEO said there will be changes soon.
“We want to review the collateral conditions and applications procedures to attract more young entrepreneurs to benefit from the billions to grow their business,” said Mr Moriasi.
Some of the youth who spoke to Weekend Business said most of their peers in the rural areas were not aware of the fund.
They asked the fund’s administrator to expedite the issuance of the loans and also widen the scope of training to include the village youth in business.
The concerns come at a time when the Government has expressed its commitment to improve the socio-economic standards of the youth who constitute the bulk of the country’s population.
The move also recognises the enormous role that youth play in building the economy through diverse entrepreneurial activities as an alternative to formal employment.
Mr Moriasi promised to work closely with registered youth groups to allow as many as possible to get contracts under the Access to Government Procurement Opportunities initiative.
“We are going to explore all possible avenues to have the youth access the State business openings,” he said.
YEDF has been making effort to register and pre-qualify enterprises run by youth, women and people with disability so that they can access government tenders and contracts, which amount to billions of shillings each year.
Nominated MP Joy Gwendo urged women and youth in business to take up the loans set aside by the State to boost their commercial enterprises.
She claimed that cash running into millions of shillings was lying idle at the County Treasury due to fear of borrowing.
‘’Eleven years since the funds were introduced by the State, very few people go for the facilities to grow their businesses because of fatalistic mentality that they risk being auctioned,’’ said the MP.
Despite the low uptake, Mr Moriasi said the Government had set aside an additional Sh900 million to advance to youth in business in all the 47 counties in the next financial year.
The officer in charge of administering youth enterprise loans, Maurice Ondiek, said they were expect to train more youth to enable them to access the YEDF loans.
‘’Training is part of the conditions that the youth in business must meet to access the kitty upon being issued with a certificate of compliance,’’ he said.