Kudzanai Gerede Business Correspondent
Youths have been urged to come up with innovative entrepreneurial ideas and make use of the various credit platforms government has set aside for enterprising young people in the wake of a constricted job market overwhelmed by a skilled workforce.
Formal employment has drastically declined owing to de-industrialization that has taken place in the past two decades against a rising number of skilled youths churned out by colleges and universities annually.
In mitigating the challenge, Government recently launched the Youth Empower Bank that will dedicate 70% of its products to youth-centered programmes and the remaining 30% to the wider corporate services for sustainability purposes. Board chairman of the Empower Bank Mr Richard Njanike told Business Post that the bank offered a lee way for young people to escape from the bondages of unemployment and start their own enterprises.
“In our model, we are positioned to facilitate financial inclusion for the Zimbabwean youths by encompassing micro finance financial advisory and support services in our products and services offered. These support services include but are not limited to mentoring programs, entrepreneurial skills development, networking platforms and business training initiatives,”
“The support services will help and demystify and change the negative perception of financial credit among the youths so they can fully realize their potential,” said Njanike.
The Empower bank will start with a $ 12 million capitalization that will be used in injecting feasible and viable startups for young people. He urged youths to come up with viable business proposals which will be granted funding on merit.
Most business enterprises within the small to medium enterprises category have fallen on hard times owing to lack of long term sustainable planning and the current capital constrains have also compounded matters as most small businesses die at infancy.
Observers have welcomed the formulation of these small businesses citing that the country needs to expand its private sector and further create employment through local investment initiatives such as which the Empower bank provides.
Israel Maboo of Alternative Business Alliance, a local lobby group for informal enterprises told Post Business that the financial inclusion strategies aiming at youth business development are critical in bringing young people into the mainstream economic structure and also facilitate for the formalization of their businesses.
“Youth participation in the mainstream economy is currently very minimal as a result of limited avenues for funding of their small businesses you see around each corner in every street. We are seeing more of that energy in the informal sector which is problematic in the sense that these businesses do not grow but end up being casualty to the harsh economic business operating environment. So they need to be taken aboard (youths), and this enables them to come up front and formalize in order to continue getting funds to expand their operations,” he said.
While capacitating youths to jumpstart various enterprises is highly welcome, experts are also critical of financial literacy levels which are extremely low within this segment which are capable of derailing credit initiatives towards the youths as the case in the past where most loans disbursed were never returned.