Empower Bank granted prescribed asset status to boost youth loans
Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, has announced the granting of prescribed asset status to Empower Bank, a move designed to mobilise resources and facilitate loan disbursements to young entrepreneurs.
Prescribed assets are a percentage of pension fund assets (and potentially those of other institutional investors) that are legally mandated to be allocated to specific government-approved instruments.
President Mnangagwa launched the Youth Empower Bank as part of the Government’s initiative to empower young people through a financial institution tailored to their unique needs.
Speaking in parliament recently, Professor Ncube stated that this development will play a crucial role in expanding the resources available to Empower Bank, which are also accessible to other investors.
He further noted that the Ministry of Youth Empowerment, Development and Vocational Training was allocated ZiG1 billion for 2025, with ZiG200 million specifically designated for vocational training operations.
This allocation also aims to facilitate the processing of loans through Empower Bank.
“Regarding Empower Bank, I can confirm that yesterday I granted them prescribed asset status. This means going forward, they should find it easier to partner with other investors, pension funds, and others who will receive benefits under the prescribed assets provisions by collaborating with Empower Bank,” he explained.
He added that this status will enable Empower Bank to access more resources, which will be shared with other investors, and potentially contribute to its recapitalisation.
Empower Bank provides loans for youth-led business and agricultural projects, asset finance, guarantees, and savings accounts, serving urban, peri-urban, and rural areas across Zimbabwe.
It also aims to empower marginalised communities and support the growth of small businesses to create employment opportunities.
Additionally, Prof Ncube announced that the Zimbabwe Women’s Microfinance Bank has also been granted prescribed asset status.
This decision stems from the recognition that women constitute 52 percent of the population and are known to contribute significantly to the economy, despite earning only 10 percent of the country’s income.
In 2023, Government-funded programmes disbursed nearly US$187 million and ZiG8,5 billion during the first half of the year.
Legally, pension funds and insurance firms are required to allocate at least 20 percent of their investment portfolio to prescribed assets.
The Insurance and Pensions Commission (Ipec), the regulatory body, has previously granted prescribed asset status to companies such as African Century (US$15 million for onward lending), Pure Oil (US$5 million for soya bean and crude oil imports), and Centra West (US$42,5 million for power generation).
Furthermore, the Zimbabwe Electricity Industry Pension Fund received prescribed asset status worth US$6,5 million for the construction of the Marondera Shopping Mall, and Datvest received US$7,5 million for residential stands development.
-herald
