How to Get Approved PM Youth Loan Scheme 2022 | Youth Business Loan

How to Get Approved PM Youth Loan Scheme 2022 | Youth Business Loan.

The Kamyab Jawan Program was introduced by Pakistani Prime Minister Imran Khan last year with the goal of providing both financial and technical support to the unemployed youth throughout the nation. The PM Youth Loan Scheme was developed to give low-cost business loans to the younger generation so they can fully realize their entrepreneurial potential as part of PM Khan’s vision to create 10 million jobs. How to Get Approved for the Prime Minister Youth Loan Scheme is the main topic of this essay.

The Pakistan Poverty Alleviation Fund (PPAF), the State Bank of Pakistan (SBP), and the Small and Medium Enterprise Authority collaborated to design the youth credit program (SMEDA). Together, the three agencies will offer children subsidized loans and equip them with the fundamental skills needed to operate a profitable business.

Prime Minister Youth Loan Scheme

This loan program can be used to launch a new company or grow an existing one. However, before applying for this loan program, you should be informed of some of its key characteristics that may help you be accepted for the loan program. The lending scheme’s characteristics are listed below.

Eligibility Criteria

  • All men/women/transgender holding a CNIC, aged between 21 and 45 years with entrepreneurial potential can apply for the loan scheme
  • For IT/E-Commerce-related businesses, the minimum age limit is 18 years.
  • Small Enterprises (start-ups and existing businesses) as per the definition of SBP, owned by people under the above-mentioned age brackets are eligible to apply.
  • For IT/E-Commerce related businesses, at least matriculation and/or experience of at least 6 months will be required

Loan Amount and Security

Tier 1Rs. 100,000 to Rs. 1 million (without collateral)
Tier 2Above Rs. 1 million up to Rs. 10 million (with collateral)
Tier 3Above Rs. 10 million up to Rs. 25 million (with collateral)
  • For a tier 1 loan, you don’t have to provide any guarantee to the lender. Just a personal guarantee of the borrower is enough.
  • For tier 2 and 3 loans, any bankable collateral such as a commercial vehicle, gold ornaments, government securities Mortgage of Property, etc. is required. The decision on the collateral will be made by the participating banks.

Loan Type and Tenor

The type of loans youth will get includes:

  • Working capital loans
  • Term loans

Under this program, loans may be repaid over a maximum of 8 years, with a maximum grace period of 1 year. The precise loan term and grace period for each loan, however, are determined by the participating institutions’ business model, judgment, and decision-making.

Focus on Women

25% of the loans under this scheme will go to women borrowers.

Mark-up Rate

  • For tier 1 loan, the mark-up rate is fixed at 3% per annum for the borrower
  • Tier 2 and 3 loan mark-up rate is fixed at 4 and 5% per annum for the borrower respectively

For more details regarding more features of phase 2 of the loan scheme, you can click here.

Now that you know all the salient features of this scheme, all you have to do is apply for the youth loan scheme. To know how it can be done, you can read an article on our website for the complete procedure.

Link: (How to apply for Kamyab Jawan Program)

Note: Right now, the registration process is closed. However, you can apply in the upcoming phase 2 of the loan scheme. Once the registration process for phase 2 will start, we will let you know.

actors to Consider before Selecting the Business

Following are the key factors that must be accounted for before selecting your business.

  • Regional suitability and appropriateness of business
  • Applicant’s motivation and aptitude
  • Applicant’s skill set, experience, education, and training
  • Demand for product/ services of business and existing supply (Competition)
  • Business set up cost and gestation time
  • Minimum Fixed overheads and break-even point
  • Revenues and margins

Making a Strong Business Plan

After choosing your enterprise, you must create a business plan that will enable you to obtain financing. How do you grow it? Simply adhere to the directions below.

You must first decide on your sector, such as retail, wholesale, service, etc. You must specify exactly what kind of business it will be.

Determine your target market because you cannot sell or market your product to them unless you do. Before creating a business strategy, you must conduct some market research to understand your target market and the level of market rivalry.

Utilize several business analysis tools, such as SWOT, PEST, and STEEPLE, among others, to identify market gaps and anticipate threats.

  • Select a name for your business. Create a brand identity and set some goals for your business before writing your business plan. Be logical and realistic in setting goals for your business.
  • After doing all the research, creating an identity, and setting goals for your business, you need to write down all the operations, marketing strategy, financial strategy, etc. to create a good business plan.

Small and Medium Enterprise Authority (SMEDA) has provided some guidelines and a template on its website that candidates can use to create a strong business plan for themselves as part of this program. The full template and instructions for this scheme’s business plan can be found here.

You guys have it now! You don’t need to know anything else about the Prime Minister Youth Loan Scheme in order to apply. Please ask us a question in the comments section if you have any about the subject.

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