1. The Federal Executive Council on Wednesday, July 22, 2020, approved the establishment of the Nigerian Youth Investment Fund, NY. The Youth Fund is dedicated to investing in the innovative ideas, skills, talents and enterprise of the Nigerian Youth and aimed at turning them into Entrepreneurs, Wealth Creators and Employers of labour contributing to national development. President Buhari led Federal Government considers Nigerian youth as a resource to be harnessed and not a problem, hence the initiation of this Fund.
2. The Fund will serve as a catalyst to unleash the potential of the youth and enable many of them to build businesses that will employ and in turn empower others. A multiplier effect of economic expansion and growth required to thrive in an increasingly competitive and connected world where adding value is the only sustainable pathway to success is expected to be achieved.
3. A minimum of N25 billion each year in the next 3 years, totalling N75Billion will be required to ring-fence the NYIF. For the remaining part of 2020, an initial sum of N12.5 billion will be needed to kick start the NYIF. It is expected that successive governments will keep the Fund, akin to a Youth Bank, alive.
4. The Nigerian Youth Investment Fund (NYIF) is a ring-fenced Fund that will strictly cater to the investment needs of persons between the ages of 18 and 35 years old. It is a restricted Fund that can only be used for the set purpose of Youth Investment.
5. NY joins a slew of Youth-oriented programmes by President Buhari to combat youth unemployment with the objective of driving innovation, fueling the creation of entrepreneurship and support youth SMEs.
6. NYIF provides a single-window of Investment Fund for the youth thereby creating a common bucket for all Nigerian youth to access Government support. Providing less cumbersome access to credit and finance for the average Nigerian youth with an approved work plan or business idea will help lift thousands of the youth out of poverty and birth a whole generation of entrepreneurs.
7. The fund aims to reach 500,000 youth annually between 2020 and 2023. Each fund approval will range from N250, 000 to N50, 000,000, with a spread across group applications, individual applications, working capital loans set at 1 year and term loans set at 3 years with a single-digit interest rate of 5%. The funding will be a single-digit facility with a moratorium for a year and payable over a designated period. Some businesses may have longer repayment cycles but again the criteria will be clear and appliance to all.
8. Disbursement will be through various channels, which will include Micro Credit Organizations across the country under the Central Bank of Nigeria supported by BOI, Fintech Organizations and Venture Capital Organizations, registered with the CBN.
9. NYIF will use proven disbursement frameworks but with special conditions with respect to the youth. There will also be a residual advisory facility for applicants and beneficiaries.
10. Usually, Youth funds focus aggressively and singularly on only rapid growth businesses. But NYIF will invest in businesses that have deeper value than only money. Such businesses must, however, be viable and able to fulfil all criteria to ensure the fund does continue to expand and serve as a production factory for businesses, but it will encourage creative arts, a culture focused businesses because Nigeria needs to start rediscovering the beauty and depth of its culture.
11. The Fund will have a converted analytics framework so that it is possible to see where investments are flowing and calibrate according to the local and global market demand. The evidence presented in terms of what some amazing youths had achieved locally and globally contributed to the berthing of this fund.
12. Youth seeking to benefit from the fund must have a fundable business idea, registered business, be a citizen of Nigeria, present recognized means of identification and guarantors. The safeguards built around some specifics being crafted around the fund will ensure that potential beneficiaries do not need to know anyone or be “connected” to access the fund. We must prove to our youths that equity is possible regardless of gender, ethnicity or religion. You simply have to be a Nigerian within that bracket with a bankable business plan. The investment will be supported on the strength of the business case and will follow a scoring template and a transparent evaluation process driven largely by technology. We will have a template that will be used to engage and accommodate the not too literate youth who also have brilliant ideas.
Gabriel Aduda
Permanent Secretary
FMYSD
tripleclicks.com
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