Picture Tag: Jean-Claude, founder of Rwanda Bio Solution
This post was originally published on the International Labor Organization website
Business formalization training for young agripreneurs from Nigeria, Rwanda, and Uganda
Article | 24 September 2021
On 15 and 17 September 2021, the ILO delivered two trainings on business formalization for young agripreneurs that operate in the agricultural value chains in Nigeria, Rwanda and Uganda. The 120 participants successfully applied to become eligible for the 2021 Green Agribusiness Fund (GAF). GAF is an initiative led by the agribusiness JR Farms and supported by FAO, which invests in youth-led socially responsible agribusinesses in various parts of Africa. The fund has various objectives, including a reduction of unemployment among young women. The selected agribusinesses can get access to various services including funding, capacity building, mentorship, and market networks. The training on business formalization marked the start of the capacity building initiative under the GAF. Participants are involved in a variety of agricultural activities such as production, processing and trading. While some entrepreneurs had already succeeded in registering their businesses, many voiced that understanding the relevant tax, bookkeeping and labor requirements was helpful to formalize their businesses and comply with the law.
This is what the trainees had to say:
- “I have learned about the importance of formalizing one's business and how it helps to position my business for funding.”
- A colleague from Uganda talked about support from the National Social Security Fund which I was not aware of. This has encouraged me to register for social security.”
- “I think that many potential partners cannot go in business with your company when it is not registered.”
Supported with a Business Formalization Workbook, the participants were inspired to reflect about their previous entrepreneurial journeys and received guidance on how to take on the next steps and progress with the formalization. In addition, they benefitted from valuable experiences shared by entrepreneurs who are already running a formal agribusiness in Nigeria, Rwanda and Uganda. As these entrepreneurs could relate well to the situation of the participants, they were able to provide useful tips and responses to the questions and concerns.
Some of the tips by entrepreneurs of formal businesses included:
- “For us, the advantages from formalization were that we got loans from banks, grants from NGOs and grants from the government to support our exporting plans. We could have not received these grants without having formalized our business. The formalization was not only about registering the business but also includes all the regulatory processes that surround the business.” Entrepreneur managing a Limited Liability Company in Nigeria. The business is involved in the production of fermented maize flour.
- “For our business, formalization led to higher credibility for business partners, helped to attract investors and improved the access to public and private markets. We also experienced that by running a formal business we earned trust with our employees and customers.” Entrepreneur managing a software development firm based in Rwanda that develops digital platforms for businesses in the agricultural sector
What’s next? Following the training, the ILO will train coaches who can in turn accompany and guide young agripreneurs on their business formalization journey.
Tags: informal employment, training, informal enterprises, informal economy
Regions and countries covered: Africa, Uganda, Rwanda, Nigeria