NEEC AND TIB DEVELOPMENT BANK - SUPPORT YOUNG GRADUATE ENTREPRENEURS

NATIONAL ECONOMIC EMPOWERMENT COUNCIL (NEEC) AND TIB DEVELOPMENT BANK CREDIT GUARANTEE AGREEMENT TO SUPPORT YOUNG GRADUATE ENTREPRENEURS

In an effort to
promote entrepreneurship, create employment and increase opportunities for Tanzanians to participate fully in economic activities, NEEC entered into a guarantee framework agreement with TIB Development Bank Limited, to create a Fund which will enable extension of concessionary loans and provision of credit guarantee to borrowers in Tanzania Mainland. The Scheme is geared towards promoting and supporting the Young Graduate Entrepreneurs, Small Medium Enterprises (SMEs) and Cooperatives which have a significant role in the economy, by creating enabling environment for expanding and facilitating access to financing requirements.

Generally, the Scheme shall target issuance of guarantees in respect to credit facilities granted by TIB for manufacturing, agriculture, trading and service provision projects that are geared to promote the growth of the economy. Therefore, the following specific criteria shall apply for young graduate entrepreneurs;-

Key issues	Explanation
Maximum Credit	Not exceeding TZS 50 million.
Eligibility Requirements	Having passed the Young Graduate Entrepreneurship Clinic run by the Council. Formally registered entity and owned by Tanzanian citizens. Having viable commercial projects, which are the basis of requesting the credit facility. Ready to offer any enforceable collateral including their personal guarantee, with the condition of allowing assignment of such collaterals to the Fund. Having applied for a credit facility from TIB relating to eligible projects on which TIB has sought a guarantee cover from the Council.
Guarantee tenure	Guarantee coverage for loans will not exceed 36 months
Collateral	University Certificates or its equivalent. Assets financed by the guaranteed credit facility (pledged or hypothecation). Assets under lease arrangements. Insurance cover with a reputable insurer.
Guarantee Fees	The guarantee fees shall be 4% of the total outstanding credit issued.
Interest Rate on Loan	Interest rate to be charged by TIB will be 16% reducing balance per annum.
Mode of operation	Provision of loans for young graduates The graduates who participated in the NEEC/UDEC entrepreneurship training program in May 2013 are advised to send their applications/proposals to NEEC from December 2014 for preliminary scrutiny and onward transmission to TIB for further action Other graduates NEEC in collaboration with Higher learning institutions is planning to conduct entrepreneurship training for young graduates in 2015. Advertisement for invitations to participate in these training programs will be made one month before commencement of the trainings. The  graduates who will successfully complete the course will be eligible for loans provided by TIB under this Agreement

National Economic Empowerment Council (NEEC), Building Office No. 3, P.O. Box 1734,Dar es Salaam. TANZANIA                                                                           

+255 (22) 2125596                                                              

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