KARACHI, July 10, 2020: The PTI government has decided to reduced the markup rate for the Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme (PMKJ-YES) to increase it’s disbursement.
Accordingly, following the directives of the federal government, the State Bank of Pakistan has revised the key features of the Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme (PMKJ-YES), the scheme was launched by Prime Minister Imran Khan to generate more job opportunities in the country.
As the country is facing Covid pandemic the PTI government has decided to further ease the scheme and approved revision in key features of Prime Minister’s Kamyab Jawan Youth Entrpreneur Scheme and as per revised features of the scheme as approved by the government, the maximum loan limit under the scheme has been increased from Rs 5 million to Rs 25 million. In addition interest rate cut to 3 percent to borrowers.
“Now youth can obtain loan under Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme upto Rs 25 million at 3 to 5 percent” : SBP
According to State Bank of Pakistan (SBP), all men/women holding CNIC, aged between 21 and 45 years with entrepreneurial potential are eligible. For IT/ E-Commerce related businesses, the lower age limit will be 18 years.
Small and medium 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 or equivalent education will be required.
Initially two size of the loan was segregated into two tiers, which now has been converted into three tiers. First tier of loan limit has been fixed from Rs 100,000 to Rs. 1 million. Previously, it was Rs 100,000 to Rs. 0.5 million. Under the second tier, entrepreneurs can get loans above Rs 1 million and upto Rs 10 million.
End user markup rate will be 3, 4 and 5 percent for tire 1, tier 2 and tier 3 respectively. While, banking rate will be KIBOR+400 for all tiers.
While, under tier three loans above Rs 10 million and upto Rs 25 million will be available up from Rs 0.5 million and upto Rs 5 million.
It will be long term loan for Machinery and Equipment / Working Capital Loan/ Running Finance, and Leasing of Business on wheels on 2/3/4 wheel locally manufactured vehicles for Upto 8 years with maximum grace period of upto one year.
The scheme will focus women entrepreneurs and some 25 percent of the loans will go to women borrowers.
Under the security arrangements for T1 loans only personal guarantee of the borrower will be required, while for T2 & T3 loans will be disbursed as per bank’s own credit policy.
Government will bear credit losses (principal portion only) on the disbursed portfolio of the banks. Some 50 percent credit losses will be bear by federal government under Tier one loans, 20 percent for Tier two and Upto 10 percent for Tier three loans.
Finance Division shall allocate funds in each fiscal year’s budget as per estimates provided by SBP. Payment will be made on submission of consolidated claims of all banks by the SBP on quarterly basis.
The Form would be both in English and Urdu and require minimum essential information with simple format available on Government provided Kamyab Jawan portal.
The processing time will not exceed 30 days and will be stated clearly in the application form. Non-refundable form processing fee will be Rs. 100/- inclusive of NADRA online CNIC verification fee.
SBP will publish consolidated information about the loans extended under this program for information of the public on quarterly basis on its website.