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Need Funding for your Startup? Read This


For the past few years, most Kenyans have been warming up to entrepreneurship with a huge number of startups being launched and a majority of employed Kenyans having their side hustles.

However you’ll agree with me that one of the greatest challenges facing entrepreneurs when starting out is access to capital. You also can’t rely on bank loans in Kenya due to high interest rates and having to provide collaterals.

An opportunity that most Kenyan entrepreneurs haven’t fully taken advantage of though is the public funds provided by the government for helping young entrepreneurs get their startups up and running. These funds also come with limitless benefits such as zero interest on loans and business training.

So far, the government has set aside more than Ksh. 25 billion for the sole purpose of creating a culture of entrepreneurship among youth and women in Kenya. Still, not too many Kenyans are taking up these funds and early this year, the government rolled out a sensitization campaign to encourage people to take advantage of the funds.

If you are looking out for capital for that business idea, here are the top 3 government funds you can tap into;

Uwezo Fund

Uwezo Fund

Are you a registered youth or women group keen on starting a business or expanding your existing business? Then the Uwezo fund is for you. This fund is administered at the constituency level through the Constituency Development Fund.

At the constituency the fund is run by the Constituency Uwezo Fund Management Committee which determines the amount of money to give to a group. Each qualified group is eligible to an interest free loan of between 50,000 – 500,000 Kenya shillings. However a 3% administration fee is charged.

To apply for the Uwezo fund here are the main requirements;

  1. Be a registered youth or women group, preferably active for the past six months with evidence of minutes of your meetings.
  2. Be organized in form of a table banking (chama) structure where members make regular contributions. Evidence of this contributions will also be required.
  3. Have a bank account in the group name, with the bank statements to prove it.
  4. The group must be based and handle their operations in the constituency they intend to borrow funds from.
  5. You must also get a recommendation from your local chief.
  6. Provide photocopies of ID’s and KRA pins of group members.

You can apply for Uwezo Fund by downloading the application form on their website or visiting the Uwezo Fund Management Committee offices in your constituency.

Women Enterprise Fund

Women Enterprise Fund
Women Enterprise Fund

For the longest time, Kenyan women have been marginalized when it comes to financial inclusion. Major challenges Kenyan women have faced include lack of capital, limited access to markets, fear of loans, financial illiteracy, religious and cultural factors and lack of collateral.

It is for this reason that the Ministry of Public Service, Youth and Gender Affairs initiated the Women Enterprise Fund to provide accessible and affordable credit to support women start and expand their businesses.

If you in a women’s group/chama, here are some benefits you are missing out on if you have not yet registered for the Women Enterprise Fund;

  1. Interest free loans – Through the Constituency Women Enterprise Scheme (CWES), women groups can access the Tuinuke loan which is given to chamas at zero interest. A group could have 100% women or 70% women and 30% men. Even though the loan is interest free, the group is required to pay 5% administration fee.
  2. No collateral required – Unlike bank loans, the Tuinuke loan does not require you to provide log books or title deeds. Instead, the women serve as a guarantee to each other.
  3. Financial Training – The WEF fund places great emphasis on financial and business training for women. Actually, getting trained on business management skills by WEF officers is a prerequisite for loan application.
  4. Easily Accessible – You don’t have to incur insane transport costs to access the WEF loan. The funds are decentralized and can be easily accessed through your local constituency offices.
  5. Easy to pay back – The Tuinuke loan can be paid back through M-PESA.
  6. WEF Soko – This is an online marketplace where products of WEF beneficiaries are showcased for purchase. Successful groups are also trained on product development, certification and are linked to local and international markets.

Youth Enterprise Development Fund

Youth Enterprise Development Fund
Youth Enterprise Development Fund

Established in 2006, the main purpose of the YEDF fund is to provide financial and business development services to youth between ages 18 – 35 who are keen on starting or expanding their business.

Even though the fund has been tainted with a number of scandals concerning mismanagement and corruption, slightly over 800,000 youth have benefited from it since its inception.

If you are a young entrepreneur, here are three YEDF loans you can benefit from;

i. Constituency Based Loans – This loan is available to individuals and registered youth groups at the constituency level looking for funds to start up a business. It is also interest free.

ii. Vuka Loan – This is a business expansion loan limited to youth who are looking to expand their existing businesses. It is the only YEDF loan where one is required to pay back with interest. The interest rate had been set at 8% until July this year where the interest rate was dropped to 6% which is still way cheaper than the current bank rates. The Vuka loan is open to individuals, partnerships and youth owned limited companies.

iii. Bid Bond/LPO/LSO Financing – This fund is eligible to youth participating in government tenders. It’s open to individuals, registered youth groups, partnerships and youth owned companies. The maximum amount available for a bid bond is 2 million while for an LPO/LSO loan the maximum amount is 20 million.


Final Word – Our government may have its weaknesses but we can’t fault them for not looking out for small businesses and upcoming entrepreneurs.

Have you tried out any of these funds? How was your experience?

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About Kuza Biashara

About Kuza Biashara

Starting a business is a leap of faith even in the best of circumstances. We at Kuza Biashara are focussed to encourage these daring small business owners who have the potential to innovate and change the world by contributing to the nation’s economy and livelihood.