#WeValueYourGrowth

 

Warima Muggi

Warima is a public servant working as a socio-economic empowerment officer for Women Enterprise Fund. She is also a lifetime Rotaractor. Ms Muggi is also a strategy partner and gender & finance trainer at Ubuntu Development Solution. Warima is a co-founder of Jajabdhu Femme

What are the specific government microfinance opportunities available for youth and Women?

 

 The government has four main affirmative action funds.

  • Uwezo Fund.
  • Youth Enterprise Development Fund (YEDF).
  • Women Enterprise Fund (WEF)
  • National Government Affirmative Action Fund (NGAAF)

NB: National Council for Persons with Disabilities also has a small budget limited to People With Disabilities.

To elaborate on this opportunities further,

Uwezo Fund and NGAAF are managed by political leaders: MP &and Woman Rep respectively.

WEF and YEDF on the other hand are semi-autonomous government agencies that operate somehow like parastatals. YEDF has products for individuals, companies and groups while WEF has products for groups, companies and SACCOS.

What are the requirements to benefit from these short listed funding opportunities?

 

 WEF for Group Loans:

  • You must be a group of 10 members or more.
  • You must be registered and stayed for a period of three months or more.
  • The membership must be 70% women.
  • The group officials must be women.
  • The group must have an active bank account.

The loans are on a graduating basis.

Cycle 1:100000

Cycle 2: 200000

Cycle 3: 350000

Cycle 4: 500000

Cycle 5: 750000

The second product is LPO/LSO Financing to government tenders

  • Must be a legally registered proprietorship/partnership/company
  • Must be 70% owned by women.
  • Must have AGPO certificate
  • Must provide a highly liquid security motor vehicle/ bank guarantee/ stock from blue chip companies in NSE

If you have satisfied the above requirements, you will go to our website we.wef.co.ke to identify your region and your constituency officer with their contacts, then you call them and they will organize financial literacy training. They will thereafter guide you on filling the loan form and going about with the process. WEF group loans do not have interest rates attached to them, however, the group is charged 5% loan administrative fee, 100 Bob per member for training and 200 Bob for an item called a loan tracker book. The training fee and the loan tracker book are charged only on the first load. As you proceed into subsequent loans, only the administrative fee is charged.

 

The grace period is one month. The maximum turnaround time- from the time you apply the loan to when you get the cheque is 45 days; this is dependent on the group's adherence to the requirements.

The loans have a repayment period of:

  • 1st, 2nd and 3rd cycles have a repayment period of 12 months each
  • 4th cycle has a repayment period of 15 months
  • 5th cycle has a repayment period of 24 months

 

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YEDF

They have the following products:

  • Rausha: (Group Loan) Kshs 100000. Payment period is 12 months. Grace period is three months.
  • Inua: after a group has paid Rausha successfully, they can move to Inua.

Cycle 1: 200000, payment period is 18 months

Cycle 2: 400000, PP is 24 months

Cycle 3: 600000, PP is 30 months.

Cycle 4: 800000, PP is 36 months.

Cycle 5: 1,000,000 PP is 36 months.

Qualifications

 

  • Registered group with a certificate.
  • Five members of the group can apply for the loan. Four out of Five must be within the youth age group (18-34).
  • Officials must be within the youth age group.
  • The group must have a bank account.
  • Smart: A product for individuals.

It is advanced to an individual member of a group who have successfully repaid a YEDF loan. However, he/she must be recommended at least 75% of the members.

  • Vuka: loan is also another product for individuals with businesses.
  • It ranges from 100000-500000.
  • Has a grace period of one month.
  • Has an interest rate of 6% and an administrative fee of 1%.
  • For this one you must provide collateral.

Lastly, YEDF has offices in each county and they are currently under the Ministry of ICT and Youth Affairs.

From your experience, what are the challenges that limit the relevant groups from maximizing this opportunities?

 

  • Lack of information about this opportunities
  • The attitude that the funds are for older women, yet anyone from the age of 18 within a group with the qualifications is eligible.
  • Lack of patience; we want money right now yet the instant options available are very predatory.
  • Difficulties associated with forming and maintaining a group for a long time.
  • Logistical challenges of accessing things like group certificate.
  • The difficulties associated with forming and maintaining a group for a long time.

What are the advantages of government microfinance as opposed to other sources of project financings?

  • They are quite affordable (zero interest rates)
  • They are development oriented rather than profit maximizing.
  • They provide other additional services; financial literacy training, market linkages, product certification linkages, online marketing services, export linkages, trade fair and exhibitions exposure.
  • They are not predatory.
  • They provide gradual financial growth as one appreciates the benefit of putting in the work.
  • They bring like-minded people together through formation of business clubs

How can we support the relevant groups in tapping into these opportunities?

  • Share the information with the groups.
  • Link them up with the relevant contact persons within their regions.
  • Encourage them to trust the process. It might be slower but it is quite affordable.
  • Follow up when you face challenges. Just don't give up. I will always help to follow up.

And on persons with disabilities funds how should one go about it especially when applying for school fees?

 

First, one must be tested and registered as PWD. I encourage you to visit their national offices at Kabete Orthopedic Centre on Waiyaki Way opposite ABC Place to clarify what is needed of you.

What are the requirements for loans to companies?

 

  • Must be a legally registered proprietorship/partnership/company
  • Must be 70% owned by women.
  • Must have AGPO certificate
  • Must provide a highly liquid security motor vehicle/ bank guarantee/ stock from blue chip companies in NSE
  • Must be a legally registered proprietorship/partnership/company
  • Must be 70% owned by women.
  • Must have AGPO certificate
  • Must provide a highly liquid security motor vehicle/ bank guarantee/ stock from blue chip companies in NSE

 

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