Youth initiatives aimed at providing employment opportunities are appealing for formal recognition to allow them to benefit from existing incentives such as bank loans.
Specifically, they say while the government has availed a special fund to support youth economic empowerment initiatives including the Business Development Fund (BDF), access to finance through the fund requires that one has a technical vocational and training (TVET) certificate.
This issue was highlighted at a recent Rwanda Youth Summit. Stakeholders said limited access to finance is still a challenge for the youth when trying to start their own businesses.
According to the President of Imparanira Kurusha Youth group in Ruhango Jean Marie Vianey Bikorimana, some of the youth in Ruhango who were picked from the streets and trained by the USAID Huguka Dukore Akazi Kanoze project went back to the streets and some went back to doing drugs.
Mr Bikorimana cited lack of access to collateral and rent money for offices, raw materials, and lack of certificates from recognised TVET schools as some of the challenges they face.
He said a big number of beneficiaries of the Huguka Dukore Akazi Kanoze project are school dropouts who do not even have a Primary Six certificate, yet the Business Development Fund Ltd (BDF) requires a TVET certificate as collateral to access the loans.
“If the government could give us equivalent certificates after the training by USAID Huguka Dukore Akazi Kanoze, we can use them as collateral to access BDF. It would be a big step towards promoting access to finance for the youth.
“We appreciate USAID for the training and equipment for baking and sewing machines. However, many of us have these machines in storage because of lack of cash to start businesses,” said Mr Bikorimana.
Emmanuel Bigenimana, the Permanent Secretary in the Ministry of Youth reaffirmed the government’s commitment to supporting youth initiatives saying that BDF is mandated to support young entrepreneurs to access funding.
“We are going to work with the banks and the Business Development Fund to ensure that the youth get easy access to loans from banks,” said Mr Bigenimana.
According to Bill Potter USAID Huguka Dukore chief, limited access to finance is a significant challenge for the youth.
“We are working with other partners and the government to look at ways that the financial sector can increase access to credit for the youth,” said Mr Potter, adding that they are educating the youth to save.
“We expected them to get small loans on their savings to use as capital for starting their businesses, even as the government helps to find ways to curb these challenges,” he added.