Microfinance institutions to ease loan application process for youth

The Association of Microfinance Institutions in Rwanda has signed a Memorandum of Understanding with Akazi Kanoze Access, a local youth initiative, to improve access to small loans as a measure to curb unemployment among the youth.

Aimable Nkuranga, the Executive Director of Association of Microfinance Institutions in Rwanda, said that the move to support the youth is one of their priorities.

With 3 million clients in microfinance institutions, over 64 per cent being youth and women he noted the need for responsible services.

“The microfinance institutions are in categories of SACCOs and non-Umurenge SACCOs, microfinance banks, microfinance companies and we would like their financial services to reach as many people as possible. Under the agreement, we have agreed to roll out financial literacy and consumer protection which is essential to know before even seeking access to finance because some misspend it well and others fail to improve lending,” he said.

He noted that the agreement, which will remain effective for a period of three years, will also improve advocacy on issues affecting youth especially limited access to loans due to lack of collateral.

The MOU also includes cooperation in integrating consumer protection principles in their practices, training, and facilitating the youth to get internship placements in financial institutions and improved and customer care.

According to Valence Twagizihirwe, the Executive  Director of Akazi Kanoze Access, there is a huge need for efforts to enable youth with practical skills to create jobs.

“We have been supporting different youth by equipping them with employable skills but they face challenges when seeking capital to start their own projects. We ought to gain skills on how to acquire and maintain loans,” he said.

He said that, since 2014 they have supported over 30,000 youth between 18 and 30 years to acquire entrepreneurship and employable skills.