Everything You Need to Know About NYDA Grants

NYDA grants are funds, support or facilitation offered by the National Youth Development Agency (NYDA) to individuals, businesses or cooperatives who qualify. In this article, you will learn all you need to know about the National Youth Development Agency (NYDA) Grant to put you in a position to get one.

Who is the NYDA Grant is for?

The grant is part of the youth development initiative by the National Youth Development Agency (NYDA) meant to alleviate the challenges that the youth of South Africa face. Youths are aged between 14 and 35 years. But for this grant, any applicant has to be between 18 and 34 years 9 months old (three months before turning 35). This is part of the qualifications that the applicants or groups of applicants must meet before they get the grant.

There are three categories of people who may apply for this grant:

1. Individual entrepreneurs
2. Individual business owners
3. Members of cooperatives

The agency insists that you must have promising business ideas that are at new stages of enterprise development before you apply. You should also be intentional about your business if you want to get a grant from this programme. The official National Youth Development Agency website states the following qualifications as a must for applicants to get NYDA grants:

Qualifications for Individual Entrepreneurs and Business Owners

• You must be between 18 and 35 years of age.
• The applicant must be a South African citizen.
• Your business must be operating within the South African borders.
• The applicant should have the skill for the business you run or intend to run or at least show the potential skill that can be nurtured.
• You must be involved in managing the day to day operations of the business.
• The applicant must be of sound mind.
• You must have no record of fraud or corruption unless you are under rehabilitation from being in conflict with the law.
• The applicant must not be an un-rehabilitated insolvent.
• You must not be attending high school, only tertiary institutions.
• The applicant should have a mentor approved by NYDA. If you don’t, the agency will assign you one of their own.
• You must have completed business management and life skills training up to a standard set by recommendation from clients.
• The applicant should have qualifications relevant to the business or at least have some experience in entrepreneurship.
• You must have a feasible business plan or viable business idea.
• The applicant’s business or business idea must be sustainable.
• Your business must have a profit motive.
• The applicant’s business must be a microenterprise, for instance, selling at stalls or being a vendor. Either run formally or informally.
• You must have a bank account.
• If you are employed when your grant is approved, you are supposed to resign. After which, you must show the evidence of your resignation to a grant officer from the agency.
• The funding you seek from the NYDA grant must be above R1,000 but should not be more than R200,000

Qualifications for Cooperatives

• All members should be youths between 18 and 35 years of age.
• Every cooperative member should be a South African citizen.
• The main applicant or at least one of the members should be involved in the day to day running of the business operations and management.
• The applicant should have the skill to run the business or at least show the potential skill that can be nurtured.
• The applicant must be of sound mind.
• The venture pursued by the cooperative should be viable.
• The cooperative should be operating within the South African borders.
• Members should be at least five.
• If the highest shareholder, who is involved in the day to day operation and management of the business, is employed when the grant is approved, they should resign. After that, they should provide proof of resignation to an NYDA grant officer.
• The sought out grant funding must be more than R1000 but not exceed R250,000.

Services Offered by the NYDA Grant

The NYDA grant has both financial and non-financial support services on offer to youths who qualify.

Financial NYDA Support

The NYDA Funding is Granted to:

• Funding request starting from R1,000 but not exceeding R200,000
• Funding requests starting from R1,000 but not exceeding R250,000 for technological and agricultural projects.
• Applicants who previously accessed and fully paid up a National Youth Development Agency (NYDA) MicroLoan of R50,000 and below
• Bridge financing
• Entrants who need co-funding partners for a legal entity
• Applicants who need working capital paid directly to them.
• Entrants who need to renovate their shops
• Applicants who need to purchase movable and immovable assets
• A member who resigned from a business or cooperative funded by the NYDA. The member should have resigned two years before they apply.

The NYDA Funding is not Granted to:

• Businesses with an annual turnover above R750,000
• Cooperatives with an annual turnover above R1,000,000
• Applicants who got financial help above R500,000 from other financial institutions
• Businesses that require funding of less than R1,000 or more than R200,000 (which is above R250,000 for projects in agriculture or technology)
• Cooperative members, Businesses, or business owners that have a withstanding Small enterprise loan from NYDA
• Businesses, business owners or Cooperative members that have any other withstanding loan with NYDA
• Businesses, business owners or cooperative members that had their loan written off by NYDA
• Partially or fully funding a loan by another loaner apart from the National Youth Development Agency.
• Applicants who want finance to replace their existing financier
• Funding venture capitals, private equity funds or investment trusts
• Provide seed capital in research and development
• Funding patent registration
• Funding to purchase exclusive business or distribution rights
• Applicants who want to fund prototypes, with the exception of cell phone applications.
• Businesses that generate their primary income from tobacco sales
• Businesses that generate their primary income from alcohol sales
• Pyramid schemes
• Ideas that are a gamble
• Loan sharking business
• Businesses in the sex and adult industry
• Businesses that operate illegal activities
• Applications by a member of the staff, Board Committee or Accounting Authority at NYDA

What the National Youth Development Agency does not Allow NYDA Grant Funding to be Used for

The funding you receive from the NYDA Grant must not be used for:

• Any purpose that you did not outline in the application for the grant, or is not defined in the due diligence stage or is not detailed in the approved terms and conditions.
• Using funds for material purchases that does not meet the reasons explained above. However, you can request written approval from the NYDA agency. Without this approval, you cannot use the funds for this purpose.
• Settling outstanding South African Revenue Authority Liabilities.
• Bribery
• Purchasing second-hand equipment except industrial equipment with a minimum lifespan of five years
• Purchasing vehicles

How NYDA Grant Funding Amount is Determined

The amount of money you get in grant funding ranges depending on the legal formation of your business. The National Youth Development Agency uses 4 thresholds to categorise these ranges:

Threshold 1

This first category is for individuals with ideas and start-ups or survivalist businesses. These get grants from between R1,000 to R10,000.

Threshold 2

This second category is for start-ups, proprietary limited companies and cooperatives. This threshold gets between R10,001 and R50,000.

Threshold 3

This category is for businesses in the growth stage as well as proprietary limited companies and cooperatives. They get between R50,001 and R100,000

Threshold 4

The last category gets between R100,001 and 200,000 (or R250,000 for agricultural and technological businesses). It is for businesses in the expansion stage as well as proprietary limited companies and cooperatives.

Non-Financial NYDA Grant Support

Depending on your needs as a business owner and manager or the needs of the business, NYDA can also give non-financial support. This support includes:

• Assignment of a mentor by the agency
• Enrolment to National Youth Development Agency’s Business Management Training Programme
• Access to Business consultancy services
• Access to the Youth Co-operative Development Programme
• Linkage to markets

What to Expect Upon Application for NYDA Grant Funding

After you submit your NYDA Grant Application form, the agency will check your credit and process the application within 30 working days. This is done by the Branch Grant Approval and Review Committee (BGARC). BGARC then approves or denies your request. The committee’s decision is final and cannot be appealed.

If your application is approved, the Head Office will disburse the grant funding within 30 working days.

How to Apply for NYDA Grants

To apply, you call the National Youth Development Agency call centre on the number 0800 52 52 52 or visit the NYDA branch near you. The application form is found here.

Key points

• All required documents must be submitted using the right channels.
• A 10-minute business presentation pitch is required on-call or in-person.
• Proof that you attended a business management training course is also required.
• NYDA officials will assess your business as part of due diligence.

About the National Youth Development Agency (NYDA)

NYDA History

National Youth Development Agency was founded in 2008 by an Act of Parliament, Act 54 of 2008. However, it was officially launched only a year later by the former President, His Excellency Jacob Zuma, in a State of the Nation Address.

Legal Framework

The NYDA derives its mandate from the legislative frameworks, including:

• The National Youth Development Agency Act, 2008 (Act 54 of 2008) (NYDA Act)
• The National Youth Policy (NYP) (2009 – 2014) and
• The Integrated Youth Development Strategy (IYDS).

Composition, Organisation and Partnerships

The agency came together through a merger between Umsobomvu Youth Fund (UYF) and National Youth Commission (NYC). As a consequence of this merger, both the formulated plans and personnel within the organisational hierarchy were inherited from the previous government bodies.

NYDA uses partnerships to:

• Improve its funding capabilities
• Source jobs for youths
• Get market linkages

Its partners include Absa, Industrial Development Corporation (IDC), Eskom Enterprises, Sasol, and Transnet.

NYDA Objectives

According to Statistics South Africa (2016), 36.2% of the population is made up of youths. NYDA recognises that the country’s challenges should also be mitigated through youth development. A necessary involvement of the youth in socio-economic progress. And so, it aims to mitigate challenges faced by the whole republic by mitigating challenges faced by the biggest portion of its population.

NYDA Achievements

According to a statement by National Youth Development Agency’s CEO, 33-year-old Waseem Carrim, in the Annual Report for 2019/2020, the agency was able to:

• Achieve 22 out of 23 planned targets for the financial year. This translates to a 96% performance.
• NYDA provided over 1 100 youth-owned enterprises in the township and rural economy with grant funding to start their businesses through the NYDA Grant Program.
• These youth-owned enterprises have gone on to create and sustain more than 5 000 jobs.
• More than 14 000 young people have been placed in jobs through the NYDA Jobs program.
• 15 new service delivery channels were established in mainly rural areas.
• 106 partnerships with civil society for the implementation of National Youth Service programs.
• R115 million in additional donor funding was raised from the public and private sectors.

The National Youth Development Agency (NYDA), through its NYDA Grant programme, provides support, training, mentorship, funding and education to business owners.

The agency was founded to mitigate challenges faced by the youth and to promote youth development. It does this through initiatives like the NYDA Grant. These initiatives mainstream youth participation in the growth of the economy. Therefore, this fund is exclusive to the youth; all the applicants must be between 18 and 35 years old.

To access NYDA Grant, you must have an intentional business or business idea that is viable. In case you don’t have the skills or training to manage and operate the business, you will be trained before being given the grant. If this happens, you must prove that you can learn the skill.

The NYDA Grant funding starts from R1,000 and goes to a maximum of R200,000. But it can go as high as R250,000 for Agriculture and technology-related applications.

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