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Agricultural finance and the youth: prospects for financial inclusion in Kenya

Rural Employment - Knowledge materials – Rural Finance










​Benni, N., Berno, D. & Hitomi, H. 2020. Agricultural finance and the youth: prospects for financial inclusion in Kenya. Rome, FAO.




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    The aim of this paper is to provide a comprehensive assessment of the current state of financial inclusion of the rural youth in Uganda, with a specific focus on their engagement in the agricultural sector and the financial services that are available to them to pursue their business ventures in this area. The study seeks to illustrate and bring to light the core constraints and opportunities associated with the provision of tailored financial services to young agricultural entrepreneurs in the country, while showcasing the essential role that key support actors (such as the Government, Central Bank, international development institutions, NGOs, foundations and many others) can play in fostering the provision and uptake of such services.
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    This brief presents the lessons learned in the domain of youth financial inclusion emerging from the implementation of the project “Integrated Country Approach (ICA) for boosting decent jobs for youth in the agrifood system”. The ICA project, funded primarily by the Swedish International Development Cooperation Agency (Sida), is currently being implemented (for the 2019-2023 period), by the Food and Agriculture Organization of the United Nations (FAO), in Guatemala, Kenya, Rwanda, Senegal, and Uganda. The brief illustrates a range of experiences and models proposed by the ICA project and its partners to facilitate youth access to formal financial services. It presents key lessons derived from the project’s experience, including the importance of enhancing youth financial literacy and their awareness of the available offer of financial services, as well as the need to introduce innovations aimed at adapting the offer of local financial services to youth’s specific needs.
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    This context analysis provides an overview of Kenya, describing youth employment challenges, policies and programmes in place as well as FAO’s priorities on decent rural youth employment. Finally, it also analyses the country’s migration trends and dynamics. Almost 88 percent of the world’s 1.2 billion youth live in developing countries. Globally, young people account for approximately 24 percent of the working poor. Although the world’s youth population is expected to grow, employment and entrepreneurial opportunities for young women and men remain limited – particularly for those living in economically stagnant rural areas of developing countries. Hence, creating more productive and beneficial jobs for the rural youth is particularly urgent. The FAO Integrated Country Approach (ICA) for boosting decent jobs for youth in the agri-food system project, currently implemented in Senegal, Uganda, Rwanda, Kenya and Guatemala, aims to address this challenge by creating more and better employment opportunities for youth in rural areas and agri-food systems. To do so, ICA combines different interventions, such as capacity development, institutional support, knowledge generation and partnership creation.

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