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Herald Reporter
Empowerbank has disbursed $22 million in loans for 2 700 youths across the country to start businesses out of the $60 million set aside to benefit 10 000 youths this year.

The loans have an interest rate of 5 percent to 10 percent a year, depending on the nature of the business.

Empowerbank acting chief executive officer Mr Shadreck Mhembere said Harare and Bulawayo provinces had the largest number of beneficiaries.

Some of the businesses that benefited from the loans have been affected by the Covid-19 pandemic, leading some bank clients seeking rescheduling of loan repayments since they are losing business due to the lockdown.

“We will have a clearer picture of the Covid-19 impact after close of April when we can establish which customers will have managed or failed to repay their loan instalments,” said Mr Mhembere.

The bank is also finding it difficult to follow-up on some of the projects because of the lockdown.

Last year, the Empowerbank extended $9 million to 1 500 youths.

Youths that benefit from the bank’s facilities present bankable business proposals and pro­jected cash flows.

The financial institution is targeting 1 000 youths per province.

The value of the loan is determined by the nature of the proposed business with standard loans being the equivalent of US$5 000 to US$10 000, paid out in local currency.

Students in tertiary institutions can also access the loans if they organise themselves in groups and come up with business proposals.

Empowerbank, which was officially opened by President Mnangagwa in July 2018, has introduced agency banks in an effort to reach out to marginalised youths.

Seventy percent of the bank’s funds are earmarked for youths while 30 percent is for other businesspeople.

The bank came into being after a realisation that youths were excluded by the formal banks from accessing loans since they lack collateral.