NMB Bank has set aside TZS20 billion to finance startups run by young people and other special groups, as universities and the private sector push for stronger links between education, skills development and employment.
The funding is expected to support young entrepreneurs with business ideas and innovative projects capable of increasing production and creating economic opportunities.
Speaking during a discussion between Sokoine University of Agriculture (SUA) and senior executives of companies whose leaders are the university’s graduates, NMB Head of Agribusiness Department, Mr Nsolo Mlozi, said access to finance was critical in helping young people turn ideas into viable businesses.
He said investment in startups would not only support economic growth but also give graduates an opportunity to gain practical experience in production and business management.
“Startups give young people an opportunity to use the knowledge they have and gain direct experience in production and running businesses,” Mr Mlozi said.
The initiative comes amid concerns over the gap between academic qualifications and practical skills required by employers, with universities being urged to work more closely with businesses to prepare graduates for the labour market.
SUA Deputy Vice Chancellor responsible for Finance, Planning and Administration, Professor Mulid Mwatawala, called on companies to create more opportunities for students and graduates to gain practical experience.
He said the university was ready to connect its students with business leaders to help them acquire workplace skills and better understand the demands of the labour market.
“The Prime Minister has directed TCU to produce 20,000 skilled young people every year. The way to achieve this target is for you, as company leaders, to give young people opportunities in your projects so they can gain experience and skills,” Prof Mwatawala said.
He also urged business executives to go beyond offering employment opportunities by mentoring young people on how to develop and commercialise their ideas.
According to Prof Mwatawala, many graduates have innovative ideas but lack the practical exposure, business networks and financing needed to turn those ideas into products and services.
He said stronger cooperation between universities, financial institutions and the private sector could help address the challenge of graduates leaving higher learning institutions without the experience demanded by employers.
“Graduates need more than certificates. They also need opportunities to learn through practice, business networks and capital that can enable them to turn their knowledge into economic opportunities,” he said.
The partnership between universities, banks and businesses could also provide a pathway for students to gain experience before entering the job market, while giving financial institutions access to emerging entrepreneurs and potentially new areas of investment.
For young people, access to affordable financing remains a key challenge in moving from business ideas to operational enterprises, particularly for graduates who may lack collateral and a track record of running businesses.
The TZS20 billion commitment therefore places emphasis on financing startups while supporting young people to build the practical and entrepreneurial skills needed to sustain businesses in a competitive market.