pm-loan-scheme

Kamyab Jawan Program | Prime Minister Loan Scheme (Business+Agriculture)

The Prime Minister Loan Scheme is a Pakistani government-backed initiative designed to provide access to affordable and low-interest loans to small business owners and agricultural entrepreneurs in the country.

This program aims to stimulate economic growth by encouraging small business owners and entrepreneurs to start or expand their businesses.

The PM loan scheme offers several features, including no collateral requirements, a low-interest rate of 0-7% per annum, and a repayment period ranging from 8 to 10 years.

The scheme is managed by the Small and Medium Enterprises Development Authority (SMEDA) and is offered through various participating banks and microfinance institutions, including the National Bank of Pakistan and Akhuwat Microfinance, etc. among others.

Kamyab Jawan Program | Prime Minister Loan Scheme

pm-loan-scheme
pm-loan-scheme

Table of Contents

Prime Minister Loan Scheme Key Features

The Prime Minister’s Loan Scheme is a government-backed loan program designed to provide financial assistance to entrepreneurs and small business owners in Pakistan.

Here are the key features of the Prime minister loan scheme:

Features:

  1. The loan is provided without any collateral security (Under PKR 1 million ).
  2. The government will provide a 50% guarantee on loans up to Rs. 1 million and a 60% guarantee on loans above Rs. 1 million.
  3. The interest rate for the loan is 0%-7% per annum.
  4. The loan repayment period ranges from 2 to 10 years.

Range of Loans and Interest Rates

The range of loans or amounts offered and interests rate are given in the following image. This scheme offers PKR 0.5 Million to PKR 7.5 Million at interest rates of 0 to 7% respectively for a maximum duration of up to 10 years.

The details of this scheme are as follows:

pime-minister-loan-scheme-key-features
pime-minister-loan-scheme-key-features

Banks and Microfinance Institutions Involved In PM Loan Scheme

The banks and microfinance institutions that are managing this entire scheme are given in the following image.

banks-and-instituitions-involved-in-pm-youth-program
banks-and-instituitions-involved-in-pm-youth-program

Eligibility Criteria

The eligibility criteria for PM Loan Scheme are as follows:

  1. The applicant must be a Pakistani citizen.
  2. The applicant must have a valid CNIC.
  3. The applicant must have a viable business plan or existing business.
  4. The applicant must not have any default history with any bank.
  5. The applicant’s age must be between 21 and 45 years (for IT Business age limit is 18 years).

Prime Minister Loan Scheme Online Application Process

Here are the step-by-step instructions for applying for the Prime Minister’s Loan Scheme:

Eligibility Checking

Step 1: Eligibility Check Before applying for the loan scheme, applicants must check whether they meet the eligibility criteria. The eligibility criteria include:

  • Pakistani National
  • Age between 21-45 years
  • Businesses must be registered with FBR, Provincial Revenue Board, or District Industries Center
  • Business must be from an approved sector
  • No default in bank loans or any government organization

Business Plan

Step 2: Business Plan Preparation After confirming eligibility, the next step is to prepare a comprehensive business plan.

The business plan should include details such as business goals, product or service details, market analysis, management structure, financial projections, etc.

Selection of Bank Or Institution

Step 3: The Prime Minister’s Loan Scheme is offered through participating banks and microfinance institutions.

A list of the banks and institutions is given above. The applicant must select the bank where they want to apply for the loan scheme.

Application Form Submission

Step 4: The applicant can obtain the application form from the official website of the PM Youth Program or from the selected bank’s website or by visiting the bank’s branch.

The application form should be filled out with accurate and complete information. The following documents are also required to be submitted with the application form:

  • Copy of Computerized National Identity Card (CNIC)
  • Two passport-sized photographs
  • Copy of NTN certificate
  • Copy of sales tax registration certificate
  • Copy of the latest utility bill
  • Project feasibility report

Processing Of Application

Step 5: Once the application form is submitted with the required documents, the bank will process the loan application.

The bank may request additional information or documents as part of the loan application process. The bank will also evaluate the business plan to determine the feasibility of the project.

Loan Disbursement

Step 6: Once the loan application is approved, the loan amount will be disbursed to the applicant’s bank account.

The loan will be disbursed in installments based on the project’s needs and progress.

The applicant will be required to provide regular updates to the bank regarding the project’s progress and usage of the loan.

Pros And Cons Of the Prime Minister Loan Scheme

Pros:

  1. Easy Access to Finance: The Prime Minister’s Loan Scheme provides easy access to affordable and low-interest loans to small business owners and entrepreneurs who may not have access to traditional bank loans due to a lack of collateral or credit history.
  2. No Collateral Requirement: The loan scheme does not require any collateral, making it easier for small business owners and entrepreneurs to obtain loans.
  3. Low-Interest Rates: The scheme offers a low-interest rate of 6% per annum, making it easier for small business owners and entrepreneurs to repay the loan.
  4. Longer Repayment Period: The scheme provides a repayment period ranging from 8 to 10 years, which provides more time for small business owners and entrepreneurs to repay the loan.
  5. Technical Assistance and Advisory Services: The loan scheme provides technical assistance and advisory services to help small business owners and entrepreneurs succeed.

Cons:

  1. Limited Eligibility: The scheme is only available to small business owners and entrepreneurs who meet specific eligibility criteria, which may limit its accessibility to certain groups of people.
  2. Risk of Default: As with any loan, there is a risk of default. Small business owners and entrepreneurs who are unable to repay the loan may face legal action or other consequences.
  3. Lack of Awareness: Many small business owners and entrepreneurs may not be aware of the Prime Minister’s Loan Scheme, which may limit its accessibility to those who need it the most.
  4. Limited Funds: The funds available under the scheme may be limited, which may restrict the number of loans that can be provided.
  5. Lengthy Application Process: The application process for the loan scheme can be lengthy, which may discourage some small business owners and entrepreneurs from applying.

FAQs

What is the age limit for the Prime Minister Loan Scheme?

To be eligible for the Prime Minister Loan Scheme, applicants must be Pakistani nationals between the ages of 21 and 45 years.

For IT Businesses minimum age limit is 18 years.

What is the maximum loan amount available under the Prime Minister Loan Scheme?

The maximum loan amount available under the scheme is up to Rs. 7.5 million.

What is the interest rate for the Prime Minister Loan Scheme?

The interest rate for the scheme is 0-7% per annum depending upon the loan amount.

What is the repayment period for the Prime Minister Loan Scheme?

The repayment period for the scheme ranges from 2 to 10 years.

Can I apply for the Prime Minister Loan Scheme if I already have a loan from a bank?

It depends on the bank’s policies and the credit status of applicants.

Some banks may allow you to apply for the loan scheme even if you already have a loan, while others may not.

How long does it take for the loan to be disbursed under the Prime Minister Loan Scheme?

The time it takes for the loan to be disbursed depends on the bank’s policies and the loan application process.

Generally, it takes several weeks to a few months for the loan to be disbursed.

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