Friday, March 29, 2024

Youth entrepreneurs fail to repay loans of over K331,000

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Minister of Youth, Sports and Child Development Chishimba Kambwili presents a cheque to Musaka Mumba of MS Catering and Events Management during the Youth development fund cheque's presentation held at the Olympic Youth Development center in Lusaka
Minister of Youth, Sports and Child Development Chishimba Kambwili presents a cheque to Musaka Mumba of MS Catering and Events Management during the Youth development fund cheque’s presentation held at the Olympic Youth Development center in Lusaka

SEVENTEEN youth entrepreneurs have failed to repay loans of over K331,000 obtained under the Youth Development Fund (YDF) in the Eastern Province and Government is contemplating taking them to court.

Government is also concerned about the slow repayment rate and the province is now seeking advice of the Attorney General concerning the defaulting youths.

Provincial Youth Co-ordinator David Musonda disclosed this during the Provincial Development Coordinating Committee (PDCC) meeting on Thursday in Chipata.

He said many defaulters are from Chipata district adding that the youth entrepreneurs got the loans in 2012 under the YDF but have not fulfilled their obligations.

“During the year under review, cheques worth over K650,000 were disbursed to 17 youths in Chipata but as of July 25 this year, only K29,664 has been recovered,” he said.

He said over K297,000 has not been recovered from young entrepreneurs from Chipata while in Katete, which had one project worth K50,000, the entrepreneurs have also defaulted.

Mr Musonda said Government is yet to recover K21,777.84 from a youth in Katete and another youth from Mambwe who got K23,926 but only paid back K12,600.

He said under the 2013/2014 YDF funding, 73 youth entrepreneurs were loaned over K2.2 million and 219 jobs are expected to be created.

Mr Musonda said most of the youths are defaulting due to low entrepreneurship skills and the only solution is to build capacity among them.

Youth, Sport and Child Development Minister Chishimba Kambwili warned against defaulting when he handed over the cheques as doing so would attract a jail sentence.

Mr Kambwili said Government has disbursed K11.842 billion in the 2012 national budget for YDF countrywide.

7 COMMENTS

  1. Government needs to give some sort of entrepreneurship training or some mentorship program to go with the loans, you dont just give money anyhow

  2. You collect PF youths from the streets and give them money and tell them to go and do business. No skills training! The youth gather for their first meeting and they use part of the money to buy food for the meeting, even having tea breaks in between. Then they will have to have another meeting to plan for projects, again lunch and tea breaks. By the time the project begins, 40% of the money has been spent already on logistics…

  3. Loans were being dished out hurriedly with intention to make a name and there was no/little consideration on mechanisms to be deployed to ensure that loans were paid back. Just like we have extension officers in the agriculture sector, we needed to have a similar wing either in the MOF or Min. of Sports that would direct, give commercial advise to the young entrepreneurs and render any additional assistance that would be required. There was supposed to be a quarterly evaluation mechanisms to enable timely correction of any deviations. The way ba Kambwili approached things, Africa will forever remain “Africa”.

  4. Assess the P/B trends of the loans and see how issues of impairment,risk including the return will affect the P/B since inception of the fund.

    It calls for proposals and credit review to be upped to ensure repayment for others to continue to benefit at the same time protecting the fund and ensuring its perpetual succession Its only means some youths can be assisted and calls for responsibility and feedback on those already assisted
    otherwise the fund might live long

  5. Should not send kids to jail! It takes time for turnover. It’s not about the kids failure in entrepreneur skills but failure of gov’t in business start ups. In only 2 years, they were expected to start up, make sufficient profit to pay back loans?? Weird. Should have given them a five year period. The gov’t should extend the pay back period another 3 years during which, the kids should be supported by big business or mentorship programme.

  6. P/B not as in payback but fund/loan scheme risk return assessment being in mind the perpetuity of the scheme with impairment in mind.

    Its a measure of credit quality performance of the scheme as to defaults and returns made whether soft or hard. Soft as to social responsibility Hard as to what has being created in entrepreneurial for young men and women

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