Established in 2006 with the sole purpose of reducing unemployment among the youth who account for over 61% of the unemployed in the country, the appropriation of funds within the Youth Enterprise Development Fund is now in question. The Kenya Union of Savings and Credit Co-operatives on Friday refuted claims that Sh150 million channeled through them by the fund had been misappropriated
Kuscco submitted a formal expression of interest to the Youth Enterprise Development Fund as a lending partner in September 2010 and was qualified for Sh300 million after the requisite process but,had no direct management of the loans. The National Youth Council which had concerns over Kussco’s participation in the fund, had complained that the fund was being misused, through creation of multiple layers, with some officials using the fund for personal allowances.
The union’s managing director, Mr George Ototo, said they had disbursed the funds as agreed with the youth fund. He stated that the union had so far received Sh150 million and disbursed 92.8 per cent of the money, amounting to Sh130.7 million, through 13 co-operative societies, while Sh8.2 million went directly to young entrepreneurs.
Mr. Ototo defended the involvement of Kuscco in the disbursement of the funds, saying they had applied to be an intermediary and received approval after which they executed a guarantee of Sh300 million. Mr Ototo said they lend to saccos at 5 per cent interest rate, and that the saccos provide the youth with loans at 8 per cent interest rate. A list of the young entrepreneurs who benefited from the list was not available.
Visit http://www.youthfund.go.ke for more information on this project.