Finding finance without a salary in Botswana
In Botswana, a person without a job very rarely obtains a bank or payroll deduction loan, as there is no income to deduct from, and must instead combine Ipelegeng public works, family help, motshelo and public start-up finance such as CEDA's.
Why lenders insist on a salary
Credit in Botswana relies on salaries paid into the lender's bank or on deduction at source. Without a payslip, banks and licensed microlenders have no way of collecting the instalment and generally turn the application down.
Unemployment among young graduates
Unemployment hits young people hard, including graduates of the University of Botswana and BIUST. The slowdown in the diamond sector since 2024 has further reduced hiring by mining contractors at Jwaneng and Orapa.
Ipelegeng, the public works programme
The Ipelegeng programme offers temporary jobs maintaining roads, cleaning or doing small community works in villages. The income is modest and temporary, so it does not allow borrowing, but it helps cover immediate needs for food and transport.
Graduate internships in government
Young graduates can join public internship programmes that pay an allowance and provide a first work experience. Banks do not regard this temporary allowance as sufficient income to support a loan application of any size.
Starting a business with CEDA
An unemployed citizen can submit a business project to CEDA, notably through the Mabogo-Dinku window. Funding then depends on the viability of the business plan in pula, not on an existing salary or employment record.
Public funds for young entrepreneurs
The ministry responsible for youth runs a development fund for young project holders, with a grant portion and a loan portion depending on the rules in force. The criteria change regularly and should be checked before applying.
Retrenchment and severance pay
After a mine or business closes, severance pay can be used to settle outstanding payroll deduction loans. Negotiating early with the lender prevents the unpaid balance from being recorded at the credit bureau and damaging future applications.
Job loss cover on existing loans
Some payroll deduction loan contracts include insurance covering a few instalments in the event of retrenchment. Rereading your Letshego or bank contract and reporting the job loss quickly can sometimes trigger this cover.
The destitute persons programme
Households without resources can approach the social workers at their district council for the programme for destitute persons. This support in kind or in cash replaces credit that no one would grant without an income.
Motshelo and family support
The motshelo savings club and the extended family are often the only sources of an advance for a jobless person, in Gaborone as in the villages. The guide to the peer-to-peer loan in Botswana explains how to put these arrangements in writing.
Finding work before a housing project
Building a house on a Land Board plot requires a regular income to obtain a mortgage. The guide to the mortgage loan in Botswana shows the conditions to meet once you are back in employment.
The situation of jobseekers in Lesotho
In Lesotho, many unemployed people also depend on remittances and community savings groups. The guide to the unemployed loan in Lesotho presents the options available to jobseekers in that small neighbour of South Africa.
Looking for finance without a salary in Botswana
- Take stock of current loans and contact each lender as soon as the job is lost.
- Check whether existing contracts include job loss insurance that can be activated.
- Register with the district council for Ipelegeng or social assistance if resources run short.
- Prepare a simple business plan in pula for an application to CEDA or the youth fund.
- Turn down any loan offer for jobless people that demands fees paid upfront by mobile money.
Resources available without salaried work
| Resource | Type | Note |
|---|---|---|
| Ipelegeng | Temporary public employment | Modest income, not enough to borrow |
| CEDA Mabogo-Dinku | Micro-enterprise loan | Viable business plan required |
| Youth fund | Grant and loan per the rules | Age and project criteria |
| Destitute persons support | Social assistance | Assessment by a social worker |
| Motshelo | Advance between members | Limited amounts |
Papers for an assistance or funding application
- Omang identity card
- Retrenchment letter or end-of-contract certificate
- Bank statements and current loan agreements
- Business plan for a CEDA application
- Proof of address or a letter from the kgosi
Scams and mistakes targeting jobseekers
- Paying advance fees to a Facebook page promising a loan with no job and no credit bureau check.
- Stopping repayments without warning the lender, which leads to a negative listing that is hard to remove.
- Borrowing from an informal neighbourhood lender who keeps your Omang card or bank card as security.
- Presenting CEDA with a project that has no market study, purely to obtain funds quickly.
Lenders to contact
- Letshego Botswana: Botswana subsidiary of the Letshego group, an inclusive lender offering personal loans and digital financial services through its LetsGo app.
- First Capital Bank Botswana: Commercial bank operating in Botswana offering personal loans to individuals to help finance their personal needs and projects.
- Absa Bank Botswana: Commercial bank in Botswana, part of the Absa group, offering banking services and credit solutions to individuals and businesses.
- First National Bank Botswana: Botswana commercial bank granting loans to individuals and businesses, regularly publishing its deposit and lending interest rates for customers.
Unemployment, Ipelegeng and public funding
Can a bank lend to an unemployed person in Botswana?
It is very rare, because banks require a salary paid into the account or demonstrable income. An unemployed person with locked savings or a salaried guarantor can sometimes obtain a small secured loan, but that is the exception.
Does Ipelegeng income make it possible to get credit?
No, Ipelegeng income is temporary and modest, which does not convince lenders. The programme aims to provide a subsistence income and maintain local infrastructure, not to open access to credit.
Can a jobless person apply to CEDA for funding?
Yes, if they are a citizen and present a viable business project. CEDA assesses the business plan, the promoter's experience and contribution rather than an existing salary, and can also offer mentoring support.
What should happen to payroll deduction loans after retrenchment?
Inform each lender quickly, check the job loss insurance and propose a repayment schedule. Severance pay can be used to settle part of the loans and avoid a listing at the credit bureau.