Academic certificates proposed as loan collateral

DODOMA: A PROPERTY security bill is being finalised by the government to allow university graduates to use academic certificates as collateral for accessing loans.

Deputy Minister for Finance, Mr Laurent Luswetula, revealed this yesterday in Dodoma while responding to a question from Special Seats MP Dr Neema Majule (CCM), who sought to know the government’s strategy to help university graduates use their academic certificates to secure loans for investment projects.

Mr Luswetula said the proposed law seeks to establish a legal framework for registration and management of movable assets through the Bank of Tanzania (BoT) in order to enhance transparency, supervision and tracking of such collateral.

“Among the assets proposed for assessment are academic certificates of university graduates, with the aim of exploring the possibility of allowing them to use the certificates as collateral in accessing loans,” he explained.

He said the government was currently continuing to advise graduates to utilise opportunities available through various government-managed funds and programmes, including youth development funds which offer soft loans to enable young people establish and expand economic activities.

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“The government has continued empowering youths economically and promoting self-employment. One of the major examples is the disbursement of 200bn/-, in addition to the continued provision of the 10 per cent loans across the country and other programmes offering affordable loans to youth,” he said.

On whether the government would be ready to provide substantial capital to graduates using certificates as collateral without additional guarantees, Mr Luswetula said many university graduates still lack strong foundations and adequate business skills.

“As government, we continue encouraging youths to first build business experience. We need to observe the progress of a graduate’s business, empower them with investment knowledge and practical entrepreneurship skills before scaling up support,” he said.

He added that the government remains ready to support young entrepreneurs whose businesses demonstrate growth potential from small to large investments through financial institutions.