Prime Minister’s Youth Business Loan is to open up the self-employment opportunities for the people of Pakistan.
All men and women age between 21 and 45 years can avail of this opportunity.
Small enterprises both startups and existing business can avail the Prime Minister’s Youth Business Loan.
The loan tenure will be of 8 with a grace period of one year.
The State Bank of Pakistan has issued a circular for all Presidents/CEOs, of all banks. The State bank of Pakistan Circular with complete details as per the official website is as under
- All men & women holding CNIC, aged must be between 21 to 45 years with entrepreneurial potential are eligible.
For IT/ E-Commerce related businesses, the lower age limit will be 18 years.
- Small enterprises (startups and existing businesses) as per definition of SBP and owned by youth as per above-mentioned age brackets are also eligible.
- For IT/E-Commerce related businesses, at least matriculation and/or experience of at least six months.
Size of the loan is segregated into two tiers.
Tier 1 (T1) loans Rs 100,000 to Rs. 500,000
Tier 2 (T2) loans Rs 500,000 to Rs 5,000,000 (5 Million)
T1 loans: The only personal guarantee of the borrower
T2 loans: As per bank’s own credit policy
T1 loans: 6% per year fixed for the borrower. The government will pay the difference of the cost at KIBOR+500bps.
T2 loans: 8% per year fixed for the borrower. The government will pay the difference of the cost at KIBOR+400bps
Applicant to contribute:
10% equity with 90% financing through a bank loan for Tier-1 loans.
20% equity with 80% financing through a bank loan for Tier-1 loans.
Loan of Rs. 500,000 (Five Lac) for a period of 8 years the approximate monthly installment is Rs.6570 with a fixed interest rate @ 6%.
Loan of Rs. 5,00,0000 (50 Lac) for 8 years the approximate monthly installment is Rs.70,684 with a fixed interest rate @ 8%.
Sectors and Products:
All sectors. Standardized schemes/ projects/ undertakings designed by SMEDA, or projects designed by private sector service providers or by individuals, themselves will also be admissible.
The application form would be both in English and Urdu and require minimum essential information with a simple format.
The processing time is 15 days and will be stated clearly in the application form.
The application forms would be readily available both in Banks and through dedicated websites. The processing fee will be Rs. 100 (Non-Refundable).
Prime Minister’s Youth Business Loan Application Form Download Below.