Young entrepreneurs decry limited access to finance

As jobs become increasingly scarce, there is growing need for entrepreneurship.

As jobs become increasingly scarce, there is growing need for entrepreneurship.

However, many youths who want to start business say there is another challenge to be reckoned with: lack of funding.

These concerns were raised at the weekend during an event organised by DOT Rwanda, a youth-led movement of daring social innovators as part of celebrations for the International Youth Day.

The event brought together young innovators, some of them winners of previous business competitions organised by the organisation.

“We convened young social entrepreneurs whom we trained to create positive impact in their communities. They have been implementing and testing business models in their communities but one of the key challenges encountered is access to capital,” Faith Mbabazi, a communication officer at DOT Rwanda.

The young innovators are creating jobs, impacting their communities but as much as they are creating opportunities, they also need to tap into available opportunities, she added.

Present at the event were officials from Business Development Fund (BDF). BDF provides collateral support of up to 50 per cent to registered cooperatives and associations as well as 75 per cent for businesses run by the youth, women, veterans and survivors of the Genocide against the Tutsi.

However, the unguaranteed 25 per cent remains problematic for the youth, according to Janvier Uwayezu, one of the young entrepreneurs at the forum.

“They shouldn’t only look at physical assets as collateral because those who have big chucks of land won’t need to go to the bank. They should consider the neediest but with promising business ideas,” he said.

Esperance Akingeneye, a young lady who operates a nursery school in Kigali’s Nyamirambo suburb, Nyarugenge District, says BDF should improve awareness of its services.

“People don’t know the process. When they say BDF provides money, many go there with preconception that it’s free and this explains why BDF should step up awareness campaigns,” she said.

John Rutagengwa, a senior investment analyst at BDF, said the main issue is mindset.

“Many people seem to think that we are a bank. But we are not and we only facilitate access to finance. When the bank accepts the idea, you come to BDF and get collateral,” he said adding that 40 per cent of their portfolio goes towards the youth.

editorial@newtimes.co.rw

 

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