After skilling, youth need to commercialise their skills by creating businesses but many struggle to access financing. Daily Monitor’s Joan Salmon spoke to Nelson Mugisha Mulera, the Head of Enterprise Development and Financial Inclusion, Equity Bank Uganda on how banks power youth enterprises.
How important is financial literacy in helping youth utilise bank financing, and what role should banks play in providing that education?
Financial literacy and education are essential for young people who wish to use bank financing effectively. We see them in two dimensions: literacy-knowing how to manage your money-and education-understanding how to grow it and manage a business sustainably. At Equity Bank, we create a sustainable financial journey for every client.
The opportunities that exist within the banking system are immense compared to those with moneylenders or microfinance institutions. Banks allow structured repayment-over, say, three or four years-making credit more manageable and less stressful.
Many young people find bank paperwork intimidating, but this documentation protects both sides’ interests . We encourage young people to build long-term credibility with the bank.
One inspiring example is a young man who started with only Shs400,000 four years ago. When he first approached us, he lived in a small boys’ quarters. Today, he owns a fully built home and a vehicle-all thanks to consistent saving and partnership with a financial institution.
Financial literacy also changes mindsets. Many grow up believing banks are rigid or unkind, but once they understand how saving works-even as little as Shs1,000-they begin to see the value of discipline. They learn to spend on needs rather than wants and to control lifestyle inflation even after their income increases. We provide this training free of charge. The only thing we ask for is logistical support-perhaps a venue for the session. We’ve conducted trainings under trees and in crowded corridors simply because people were eager to learn.
Those who undergo financial literacy training become less risky borrowers. They understand why saving, investing, diversifying, automating payments, and maintaining good governance matter. Banks are well placed to offer this education because we interact with people from all walks of life. From this exposure, we’ve learnt that those with less formal education often take bigger risks and grow faster, while the more educated tend to overanalyse and delay decisions. Financial literacy helps bridge that gap-encouraging smart, informed risk-taking.
How can banks design products that meet the aspirations of young entrepreneurs?
Banks must innovate to meet young people where they are. When I was at university, I saved Shs,1,000 of my pocket money each time with a certain financial institution, which allowed small deposits. Eventually, I saved Shs7,000, bought ice cream, sold it, and built capital of Shs350,000 within four months. That simple opportunity shaped my entrepreneurial mindset.
At Equity Bank, we’ve shifted from traditional banking halls to digital banking, because today’s youth want instant, mobile solutions.
You can now dial 247# on the Equit Bank app to access loans from your phone. We also realised that what young people need to know about money isn’t taught in school. So, we partner with like-minded organisations to extend financial literacy. For example, we’ve trained over 10,000 refugees and provided Shs2-3 billion in loans.
Our Youth Loan product offers up to Shs5m without collateral-the group itself acts as security. If one member defaults, the whole group is affected, which fosters accountability. For women, our EquiMama product provides Shs3m or less with no collateral, recognising that many women lack land ownership. We also tailor loans for refugees, giving them access to up to Shs5m to grow small enterprises.
All these products arise from research, customer engagement, and partnerships with development partners. We are constantly evolving to match the mindset of young entrepreneurs-creative, ambitious, and digitally savvy.
Many young people don’t trust banks. How are you rebuilding that trust?
Trust is central to banking. Everyone wants to know that the money they deposit today will still be there tomorrow. Firstly, we removed ledger fees (monthly fees). If you deposit Shs10,000, it remains untouched-and even earns interest. Young people also fear losing collateral, but we’re not in the business of selling property as it is also a costly venture. We lend responsibly because we know that some collateral is for the family. Collateral simply ensures commitment.
For those without assets, we’ve introduced digital micro-loans where your borrowing history builds trust over time. Finance is built on trust, and digital systems help reinforce it.
Distrust often stems from experiences with unregulated moneylenders who exploit borrowers. Banks, on the other hand, are heavily regulated by the Bank of Uganda, which ensures professionalism and transparency. With continued interaction, young people will see that banks truly have their best interests at heart.
What policies or initiatives could enhance youth access to financing?
The Bank of Uganda has introduced a national curriculum on financial literacy and business development services, which is an excellent step.
Equity Bank also partners with development organisations to understand young entrepreneurs and influence policy accordingly. Our trainers visit markets and refugee camps to engage business owners and enhance their skills.
We’ve developed inclusive products like health insurance for market women and boda boda riders. For just Shs3,000, one can access coverage worth up to Shs3m. These innovations stem from observing real customer needs. Equally important is information dissemination. In the past, banks didn’t prioritise communication, but we’ve learned that people perish for lack of knowledge. By explaining what we offer and why, we empower individuals to make informed financial decisions.