The Punjab Rozgar Scheme (PRS) is a flagship initiative by the Government of Punjab, launched in October 2020, to provide subsidized credit facilities to startups and existing businesses (SMEs) in collaboration with commercial banks. The scheme aims to foster entrepreneurship, create employment opportunities, and stimulate economic growth in the province.
Key Features of the Punjab Rozgar Scheme
Loan Limits and Types
- Clean Lending: Loans ranging from Rs. 100,000 to Rs. 1,000,000.
- Secured Lending: Loans ranging from Rs. 1,000,001 to Rs. 10,000,000.
Note: Under the Punjab Green Development Program (PGDP), loans remain within the same limits, with a preference for micro-enterprises adopting environmentally friendly technologies.
Interest Rates
- Clean Lending: 4% per annum.
- Secured Lending: 5% per annum.
Note: The remaining markup is subsidized by the Government of Punjab.
Loan Tenure
- Term Loans: 2 to 5 years, including a grace period of up to 6 months.
Debt-to-Equity Ratio
- For Males: 80% loan to 20% equity.
- For Women, Transgender, and Differently Abled Individuals: 90% loan to 10% equity.
Eligible Sectors
- Manufacturing
- Services
- Trading
- Agriculture and Livestock
Note: Preference is given to businesses adopting resource-efficient and cleaner production technologies.
Target Beneficiaries
- University/College Graduates with entrepreneurial skills.
- Diploma Holders from Technical and Vocational Education and Training (TVET) institutes.
- Artisans and Skilled Workers.
- Existing Businesses affected by COVID-19.
Security Requirements
- For Loans Up to Rs. 500,000: Personal guarantee of the borrower along with a net worth statement.
- For Loans Between Rs. 500,001 and Rs. 1,000,000: Personal guarantee of the borrower along with at least one third-party guarantee or a guarantee from a government employee of BPS-10 and above.
- For Loans Above Rs. 1,000,000: Mortgage of assets such as residential, commercial, industrial, or agricultural property, or vehicles with clear title and acceptable access.
Processing Fee
- A non-refundable processing fee of Rs. 2,000 at the time of application submission.
Application Process
- Online Application: Applicants must submit their applications through the dedicated online portal of the Punjab Rozgar Scheme, developed with the support of the Punjab Information Technology Board.
- Documentation: Required documents include:
- Valid CNIC.
- Business plan.
- Net worth statement.
- Security documents (if applicable).
- Approval and Disbursement: Upon approval, loans are disbursed in installments as per the approved business plan.
Recent Updates
- Loan Limit Increase: In December 2022, the Punjab government decided to double the upper limit of subsidized loans under the Punjab Rozgar Scheme from Rs. 10 million to Rs. 20 million to promote economic activities and increase employment in the province.
- Extended Repayment Period: The loan repayment period has been extended from 5 years to 8 years to ease the financial burden on borrowers.
Conclusion
The Punjab Rozgar Scheme is a significant step towards empowering entrepreneurs and supporting SMEs in Punjab. By providing access to affordable financing, the scheme aims to stimulate economic growth, create employment opportunities, and promote sustainable development in the province.
Tags
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