Your are here  » Home   » Business News

Youth Fund recalls Sh1bn held in commercial banks

Updated Tuesday, April 9th 2013 at 00:01 GMT +3


Nairobi,Kenya: Kitty managers say financial institutions have been trading with the cash and lending it out at commercial rates

he Youth Enterprise Development Fund (YEDF) plans to recall over Sh1 billion it advanced to various commercial banks to lend to youth in the country.

The fund’s top management yesterday said that the money being recalled would be lent out to the youth directly and at a rate of 8 per cent. 

The fund’s Acting Chief Executive Catherine Namuye said that young people who have been applying for the money in various commercial banks are getting discouraged as the financial institutions have been demanding they meet too many conditions. 

She said that the youth kitty  was created six years ago to enable young people to borrow money for business development at lower rates than the 15 to 23 per cent that commercial banks are currently offering.

“The banks mixed the money with their loans and are lending to the youth at the current market rates,” she said. “Further, the banks have been trading with the money instead of lending it to the youth.”  

She added that some youth have opted not to borrow money as they feel the conditions being imposed are too stringent. For instance, some are being asked to first open an account with the bank and operate it for some time before they can access money from the fund.

However, Family Bank’s Chief Marketing Officer Henry Karugu discounted the claims that bank’s are offering Youth Fund money at a higher interest rate than 8 per cent.

He also insisted that loan advancement has to follow the bank’s procedures.

“When giving loans, we follow the processes as outlined in our policy. We scrutinise every bit of   information the youth present before advancing them loans,” Karugu said.

YEDF Chairman Evans Semelang’o added that they have now opened offices in the former 210 constituencies, with each being manned by two enterprise development officers. The fund has also opened 10 regional offices in the former eight provinces, and introduced sector-specific funding to ensure that no area of development is overlooked.    

GO TO PAGE 1 2 Next »

Next Story »

More Stories
See More »

  • Court allows Atwoli, Mugo back to NSSF board

    Industrial Court on Monday suspended notice by Labour Cabinet Secretary Kazungu Kambi removing COTU’s Francis Atwoli and FKE's Jacqueline Mugo from NSSF board pending outcome of a case filed by COTU boss.
    Read More »
  • Manufacturer raises alarm over fakes

    Local alcoholic drinks manufacturer London Distillers has raised alarm over the increased counterfeiting of alcoholic products in the country. The firm has claimed that spirits manufactured by a Tanzanian company based in Arusha are being smuggled in large quantities in to Kenya.
    Read More »
  • Logistics firm eyes a piece of port terminal business

    Logistics firm Bollore Africa Logistics is keen on running the second container terminal at the Port of Mombasa. The firm said it would place a bid should the Kenyan Government call a tender for concession to run the terminal that is currently being constructed by the Kenya Ports Authority once it is complete.
    Read More »
  • State earns Sh860m from KWAL sale

    The Government will sell a 26 per cent stake in Kenya Wine Agencies Ltd (KWAL) for Sh860 million to South African firm Distell Limited.
    Read More »
  • Attempts to shut down nine gas filling plants challenged

    Middle tier and small companies marketing cooking gas in Kenya have claimed unfair treatment from government. The firms accuse State officials of favouring multinationals. They say plans by government agencies manning the petroleum industry to shut down nine gas refilling plants citing national security are discriminatory.
    Read More »
  • MPs want Treasury to recover billions invested in Telkom Kenya

    The Public Investments Committee (PIC) of Parliament may have given the National Treasury an impossible task in asking it to claw back its shareholding in Telkom Kenya.
    Read More »
  • Rural connectivity poor

    Africa’s growth in mobile telephony has been remarkable. But lack of adequate infrastructure to support telecommunication providers to connect rural communities to the internet is the biggest setback, a leading African Internet Service Provider says.
    Read More »
  • Kenya Orient allowed to operate life insurance

    The Insurance Regulatory Authority has licensed Kenya Orient Life Assurance Limited to operate life assurance business. The company is a sister company to Kenya Orient Insurance Limited, which has been offering general insurance.
    Read More »
  • Ecobank Kenya gets licence to open investment bank

    Competition in the investment banking business has gone up a notch higher. This follows the entry of EBI Investment Corporation Kenya Limited, a subsidiary of Ecobank Capital. It has been granted an investment banking licence by the Capital Markets Authority (CMA).
    Read More »
  • Equity to know Thin SIM fate this week

    The fate of Equity Bank’s entry into the telecoms industry will be known this week when the industry regulator responds to concerns raised by Safaricom over the bank’s Thin SIM technology.
    Read More »

Find us on Social Media

Popular Business

Popular News


Stock Market

KEGN 9.80 0.00
OCH 5.70 0.00
EQTY 46.50 +0.50
KNRE 18.75 +0.10
ICDC 43.00 +1.25
View All Stocks »


Forex Chart