Prime Minister's Youth Business Loans

Prime Minister’s ‘Youth Business Loan’, for young entrepreneurs between the age group of 21 – 45 years, is designed to provide subsidized financing at 8.0% service charges per annum for nearly one hundred thousand (100,000) beneficiaries, through designated financial institutions namely National Bank of Pakistan (NBP) and First Women Bank Ltd. (FWBL).

Small business loan with tenure up to 8 years, with first year grace period, and a debt : equity of 90 : 10 will be disbursed to SME beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwah, Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA). It has a 50% quota for women and 5% quota for families of Shaheeds, Widows and Disabled persons.

Forms are available at branches of all participating banks for free and you need to submit your form with a valid copy of your CNIC and your business plan.

Pre-feasibilities as Guidance for Business plan

SMEDA has taken the initiative of developing pre-feasibility studies in fifteen sectors, and as per directions of the Prime Minister, has made them available to new start up SMEs, through the SMEDA website, for the promotion of an entrepreneurial culture in Pakistan. To date, our website has recorded more than 117,000 downloads of the published pre-feasibility reports.

These pre-feasibility studies provide a general understanding of the proposed business, and are structured like a business plan. However, to assist the prospective entrepreneurs / loan applicants, SMEDA will provide a template for business plan preparation and requisite guidelines for the loan applicants, as soon as the loan application forms are made available by the participating banks on their respective websites.


 

Brief description	Prime Minister’s Business Loans will focus on unemployed talented youth of Pakistan, irrespective of location and background looking for establishing new enterprises.
Eligibility criteria	All young men/women, Pakistani citizens with a valid CNIC. Age 21 – 45 Years.  Entrepreneurial potential.
Focus on women	50% of loans will go to women.
Debt-Equity ratio	90:10 with tenor of up to 8 years; 1st year grace period and then easy monthly installments for 7 years.
Pricing	8% fixed for borrower but government will pay the difference of 7% and any other charges
Refinancing	SBP to explore providing 50% refinance at the risk of participating banks
Risk mitigation	Government will share 50% of losses subject to a maximum of 10% of the loan amount
Number of Loans	100,000 in fiscal year 2013-14
Size of Loan	Rs.0.1 – 2.0 Million
Executing agency	NBP and First Women Bank under the guidance and supervision of SBP. Forms are available across Pakistan on all branches or online
Sectors and Products	All sectors. Standardized schemes/projects/ undertakings will be designed by SMEDA, projects designed by private sector service provider or individuals themselves.