Want to apply for the YEDF loan? If so, we will show you the types of loans you can apply for and how you can access the YEDF Application Form 2024. Read on for more details.
The Youth Enterprise Development Fund (YEDF) is a government entity operating under the Ministry of Public Service. It stands as one of the cornerstone projects of Vision 2030, falling within the ambit of the social pillar.
Established in 2007, its primary objective is to tackle the pressing issue of youth unemployment, with a strategic focus on empowering young individuals to become entrepreneurs and job generators.
This piece delineates the core responsibilities, functions, and offerings of the Youth Enterprise Development Fund in Kenya.
YEDF Key Responsibility
The Youth Enterprise Development Fund (YEDF) is tasked with several key responsibilities:
- Extending loans and providing market support to enterprises owned by young entrepreneurs.
- Facilitating connections between youth-owned enterprises and larger businesses.
- Offering comprehensive entrepreneurship training and mentorship programs.
- Furnishing trading spaces and operational premises for youth-owned businesses.
- Providing coaching and assistance for youth seeking employment opportunities abroad.
YEDF Application 2024/2025 and Application Process
To apply for assistance from YEDF, individuals can visit their respective sub-county or constituency headquarters.
The application involves completing a designated form and attaching the necessary documentation.
At the constituency level, an officer will guide the applicant through the essential steps, including vetting, training, and the overall application procedure.
Types of YEDF Loans and Their Requirements
The Youth Enterprise Development Fund extends various types of loans to cater to diverse needs:
1. Group Loans
Group loans do not incur interest charges. Instead, a one-time management fee of 5% is levied upon disbursement.
These loans are expected to be repaid into the specified corporation account provided to the youth group.
Individual, Company, and Partnership Loans
Under this category, there are sub-divisions catering to specific situations and requirements. Each type of loan serves distinct purposes and adheres to specific criteria as defined by the Youth Enterprise Development Fund.
Additionally, the groups must have the following Documents:
- A copy of the officially certified and valid group registration certificate along with a membership roster.
- Photocopies of identification documents for ALL group members.
- A signed commitment from the group undertaking responsibility for loans guaranteed to its members.
- Group meeting minutes nominating or authorizing an applicant for a specific round of the loan.
- A fully completed YEDF loan application form.
- Group bank account particulars.
Minimum Qualifications for YEDF Application Form 2024/2025
- The group must possess a valid registration certificate issued by a relevant government authority.
- The group should comprise more than five members.
- At least 70% of the group’s membership must fall within the youth bracket (ages 18 to 34), and all leaders must also be youth.
- The group must maintain a collective bank account with a minimum of three authorized signatories, where the funds will be deposited.
Types of YEDF Loans
1. Rausha Loans: Designed for start-up businesses or income-generating activities. It offers a three-month grace period, followed by repayment in 12 monthly installments. Groups can apply for up to 100,000 in cash.
2. Inua Loans: Ranging from a minimum of 200,000 to a maximum of 1,000,000, this category caters to existing businesses owned by youth.
Groups that have successfully repaid the Rausha loan are also eligible to apply for this type. The loan amount increases with each subsequent application.
3. Special Loans: Intended for youth groups engaged in projects that generate income periodically or at pre-determined irregular intervals.
These loans are available for projects such as agriculture, livestock rearing, fish farming, poultry, and supplies.
4. Smart Loans: Applicable to individuals within a group. After a group benefits from YEDF and repays the loan, members are eligible to apply for this type of loan for individual start-ups or business expansion.
To qualify, individuals must meet the following conditions:
- Be recommended by 75% of the group members.
- Provide minutes from the group meeting authorizing the individual to borrow.
- Initially, a maximum of 80% of the group members may borrow. Subsequent funding for the remaining members (20%) is available after two installments on the initial loans have been paid.
5. Swift Loans: Available to groups that are new consumers of YEDF products. Security measures are involved in qualifying for this loan:
- Group members collectively guarantee loan repayment in case of default.
- An appropriate life insurance policy of the borrower is used to secure the loan.
- The borrower’s assets can be used as collateral. In cases where they do not own any, they can use items belonging to their parents or relatives.
- A registered chattel mortgage must be attached to applications for loans exceeding 100,000.
Loans for Enterprises and Partnerships
Vitality loan: Designed for both startups and business expansion, aimed at acquiring income-generating assets. The following criteria are expected for applicants:
In the case of a partnership, a minimum of 70% of partners must be youth. The borrower is responsible for all expenses such as security arrangement, charge/chattel registration, legal fees, valuation, and insurance.
Some of the available products for individuals are:
Vitality startups: Secured by conventional collateral. Applicants must present a verifiable business plan. Up to 500,000 Ksh.
Vitality expansion: Comes with a one-time management fee of 1%, deducted upon disbursement, and carries an interest rate of 6%.
It includes a one-month grace period. The loan range is from a minimum of 100,000 to a maximum of 500,000.
Loans over 100,000 are secured using conventional collateral, while those under 100,000 can be secured by chattels, stock, and business assets.
Vitality Assets Financing: Loans over 100,000 are secured using conventional collateral, while those under 100,000 can be secured by chattels, stock, and business assets.
In the case of a motor vehicle, it should not have been in operation for more than 8 years. The vehicle must be fitted with a tracking device and insured for security.
Other available products are:
- Agri-business loan: Tailored for agricultural-related projects.
- Trade Financing: Geared towards government supplies, such as LPO funding.
- Talenta loans: Catering to creative performance arts projects.