Loans can be a big boost to businesses operated by the youth

Every year thousands of youths graduate from universities and colleges in full anticipation of getting employed immediately thereafter. However, the actual situation on the ground proves otherwise; employers are no longer hiring job seekers as it was in the past. Back in the 1990s and early 2000s, there used to be a scramble for graduates in industries.

For instance, two or three companies would offer you an opportunity to work for them and the pay for a white-collar worker was really good in those years. But today, the situation has completely changed. Companies are downsizing; instead of hiring they are firing their employees. Thousands of graduates are just loitering in the streets praying that someone would offer them jobs. But jobs are hard to come by, compelling youths to go into entrepreneurship.

The economy is in bad shape. For years now, government has struggled to fulfil its mandate of job creation. With a new government in 2020, youths waiting with bated breath, hoping the one million jobs which the Tonse Alliance government had promised would come into fruition. It never worked. It turned out the whole thing was a campaign ploy. There was no concrete plan to employ one million youths after all.

So, some youths set up their own businesses to make ends meet. The challenge though was to come up with an initial capital. In such circumstances banks are reluctant to release their monies to support business plans that are managed by youths, while elsewhere you owe to own, here you own to owe. Loans are for big companies who own properties which are used as collateral in case you default.

But this thinking must change if the youth are to become reliable entreprenuers, who can in turn, employ fellow struggling youths thereby contributing to national development. Banks and financial institutions must begin to offer loans to youths as a stepping stone to economic emancipation. There are many Malawian youths who are bright and innovative – and can positively contribute to economic development if their businesses can be supported with loans.

Of late, National Economic Empowerment Fund (NEEF), has tried to give loans to the youths but again, when politics begin to rare its ugly face, dictating who should and should not receive these loans, the whole process becomes tainted. We are of the view that NEEF is very important in Malawi because it provides loans and financial support to small and medium-sized businesses, especially those in marginalized groups like youth and women.

This support promotes economic growth, creates jobs, and helps with poverty reduction by enabling entrepreneurs to start or expand businesses, particularly in sectors like agriculture. NEEF is a key tool for inclusive growth and economic empowerment across the country.

Currently, government has ordered that NEEF should undergo a comprehensive audit, in light of alleged inefficiencies and irregularities. We hope that all ends well so that NEEF can continue with its mandate to contribute to the country’s economic development through the provision of diversified loan products to Micro, Small, and Medium Enterprises; contribute to increased employment by, among others, supporting enterprises that have the potential to create jobs; and entrench the enterprising spirit in youth, women, and other groups that have the potential to contribute to socio-economic growth. Malawian youths need these loans to boost their businesses.