How can you acquire loan under Kamyab Jawan Program? SBP explains detailed procedure

According to the reports, 1 million applications have been received so far.

Prime Minister Youth Affairs Programme’s ‘Kamyab Jawan Programme’ (KJP) provides loans to youth, who want to start their own business or want to expand their current one. Three weeks after its launch, around one million applications have been received.

An official said the PM’s Kamyab Jawan Programme has been receiving 80,000 to 100,000 applications daily, which itself is an example of the youth’s interest and success of the program.

An amount of Rs. 100 billion has been allocated for the program to assist one million youth across Pakistan.

He said that the program was ambitious and unique, and its goal was to provide soft loans to people and create job opportunities for them with a follow-up strategy.

“A person can apply for a loan of Rs50, 000 up to Rs50,00,000 on easy returned back policy.” – said the programme officer.

SBP discusses the detailed procedure:

The State Bank of Pakistan (SBP) has sent out detailed directives about the payment procedure service charges and credit loss subsidy of Prime Minister Imran Khan’s ambitious Kamyab Jawan Youth Entrepreneurship Scheme (PMKJ-YES).

Regarding the loan size, the central bank informed that under the Kamyab Jawan Loan Scheme, the loans are primarily divided into two categories:

  • Tier 1 (T1) loans: from Rs. 100,000 to Rs.0.5 million.
  • Tier 2 (T2) loans: above Rs 0.5 million and up to Rs 5 million.
What will be the service charges?

The loans under the Kamyab Jawan Program will be provided via the banking system at service charges of 6pc p.a. for TI loans and 8pc p.a. for T2 loans.

~ Rate of return for banks working as EAS (Executing Agencies): 

The rate of return for banks working as EAS for PMKJ-YES would be

  • T1 loans: KIBOR (6- Months offer) + 500 bps.
  • T2 loans:  KIBOR (6- Months offer) + 400 bps.
                                                           (with KIBOR to be re-set biannually)

The Central Bank further added that the Government of Pakistan (GOP) shall absorb the difference between the rate of return for EAs and the end-user rate as to service charges subsidy.

Additionally, the government will also bear the credit losses on the disbursed portfolio.

“As per SBP’s Prudential Regulations for Small Enterprise Financing, loans are classified as a loss on an objective basis (time-based criteria) when the default period is 18 months or more or on a subjective basis. Hence, for determination of admissible credit losses against EA’s total PMKJ-YES disbursed portfolio at the end of each quarter, only loan cases classified under loss category as per SBP SME Financing PRs will be considered,” the statement from SBP stated.

What will be the procedure for the loan disbursements?

EAs will be evaluating all the loan applications that they are receiving using the parameters of PMKJ-YES. The parameters have been approved by the Federal Cabinet and circulated by the State Bank of Pakistan to all the banks on July 11, 2019.

After completion of the formalities, the loan for the borrower will be sanctioned and disbursed by the EA. The loans will be entitled to the services charges subsidy and credit losses subsidy. The State Bank of Pakistan will not conduct any evaluation on the eligibility of the borrowers.

Payment of Service Charges Subsidies:

The bank further revealed that the charges will be made through the Development Finance Support Department (DFSD), SBP BSC Head Office Karachi, the operational arm of the central bank.

EAs will prepare and submit their claims to DFSD to receive ”government service charges subsidy on the outstanding principal amount of their regular PMKJ-YES portfolio up to the expiry of each individual loan.”

What if the loan becomes non-performing?

If the loan becomes non-performing, no services charges will be paid after it is declared a loss by SBP PRs for SME Financing. The claims made by EAs shall contain particulars of each individual loan accompanied by the calculations of subsidy. The calculations will be based on the relevant six months KIBOR used.

DFSD, SBP BSC will be responsible for scrutinizing the claims of EAs within the 15 working days after the receipt of the information is provided by the EAs. The DFSD will decide if the applicable KIBOR rate has been used and the calculations made by the EAs are accurate.

What are your views on this? Share in the comments bar below.

    • Old video time and MB waste.
      This apply is online and now this is closed .
      Wait for 2nd phase to apply on site kamyab jawan loan scheme.

  • Wao great opportunity for youth…
    When SBP will anounce phase 2 of this initiative…

  • This program is very helpful every poor people thanks to imran khan So plz give us loan i try it.

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