Karachi: On Thursday, the government announced the launch of the ‘Prime Minister’s Kamayab Jawan SME Lending Programme’ with the goal to provide unemployed youth with start-up opportunities, according to news reports. This programme will provide credit loss protection and mark-up on small business loans of up to PKR 5 million.
The State Bank of Pakistan (SBP) announced that any CNIC holder from the ages of 21 to 45 years, who has ideas and the potential to do business is eligible for a loan under this new scheme. For e-commerce and IT related businesses the age limit for eligibility has been set lower at 18 years. Existing small enterprises owned by the youth are also eligible for the loan under the scheme. About 25% of these loans have been designated for females.
Each year the financial division will allot funds according to the budget to this scheme as per the estimates of the SBP.
The programme is divided into two tiers. Tier-1 includes loans of very small scale, PKR 0.1 to 0.5 million, while Tier-2 includes loans of PKR 0.5 to 5 million, which will be provided for 8 years with a grace period of maximum one year. Tier-1 loans will require a personal guarantee for the borrower whereas Tier-2 loans will be provided on the basis of the bank’s own credit policy.
