A majority of youth in low income settlements have never heard of the Youth Enterprise Development Fund and therefore have never used it, a new survey shows.
According to a study by the Pan African Research Services on utilisation of the fund released over the weekend and covering slums in Nairobi, Makueni, Machakos, Uasin Gishu and Kisumu, less than one fifth of the youths in these areas stated they had utilised the fund.
“The main reason for not utilising the fund is lack of awareness of the fund as well as the procedures for application mentioned by more than half of the youth (54 per cent),” the study says in part. “At least 15 per cent felt the process was tedious.”
Of the five regions, and covering a 390 sample size, youths in Machakos and Makueni registered the highest percentages of those not utilising the fund with 98 per cent of those interviewed in Machakos and 91 per cent in Makueni saying they have never used the fund. The fund provides easy and affordable financial and business development support services to youth who are keen on starting or expanding businesses.
The survey indicated that the number of those who have borrowed money from the fund in Nairobi and Kisumu is pegged at 30 per cent and 20 per cent respectively, casting doubtd on the effectiveness of the fund in addressing poverty and unemployment among the youth.
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The Youth Enterprise Development Fund was established in December 2006 by the Government to address the unemployment rate among the youth. It is estimated that youth unemployment is running between 65 and 80 per cent of the total unemployment.
Fear repayment plans
Apart from not knowing that the fund exist, the other main reasons given for not accessing the fund included tedious and long application processes and requirements. About 15 per cent of those interviewed said these were the reasons they had not accessed the fund. Another 12 per cent simply said they were not interested in the fund or had no specific project to invest in.
For others, nine per cent, they have not used the fund because they think it is a corrupt system. Yet others— around 10 per cent— said they had not expressed interest in the fund either because the capital given is too little or they fear the repayment plans.
Some of those youths interviewed also said they find the whole process expensive while others complained of stiff competition from many other groups applying for loans.
The researchers said the sample size is representative enough in the research field given that only five counties were covered asking the Government to take appropriate measures to increase awareness on the existence of the fund.
“The idea of the youth fund was a good target for the youth if only they were able to access it,” said Pars Research Associate Director Susan Chege.
“If truly the government is serious about youth unemployment, they should address some of these loopholes. NGOs and organisations working on youth issues can also use the research findings to upscale their education on the youth. We had decided to focus on youth because of the issues they are facing, especially on unemployment and crime,” Ms Chege said.
To ease access to the fund, YEDF Board chairman Ronald Osumba last month urged the youth to form groups as it is one of the best and easiest way to get funding for business startups.
He said the group loans being offered by the youth fund do not need collateral which is something most youth struggle with. “Groups make one accountable because members keep each other in check,” said Mr Osumba.
