To provide self-employment opportunities and uplift the youth of the country, the Government of Pakistan has introduced a low cost financing scheme under the banner of Kamyab Jawan. The scheme offers subsidized loans to meet long-term and short-term financing needs.
Long-term /Working capital loan requirement including leasing/ financing of locally manufactured vehicles for commercial use (only one vehicle per borrower)
All citizens of Pakistan 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, owned by youth as per the above mentioned age brackets are eligible.
For IT/E-Commerce related businesses, a minimum education level of matriculation or equivalent will be required.
The scheme is available in three tiers with the following main features:
|Tiers||Amount (PKR)||Pricing||Minimum Equity Requirement (for startups only)||Security|
|Tier-1||100,000 to 1,000,000||3%||10%||Personal Guarantee|
|Tier-2||1,000,001 to 10,000,000||4%||20%||Collateral as per bank’s credit policy|
|Tier-3||10,000,001 to 25,000,000||5%||20%||Collateral as per bank’s credit policy|
*pricing may change as per State Bank of Pakistan directives
**Vehicle financed under T1, T2 & T3 may serve as collateral
All eligible persons can apply for the loan by visiting the Kamyab Jawan Portal at https://www.kamyabjawan.gov.pk or through the Kamyab Jawan mobile app (available on App Store & Google Play Store)
This is to inform you that the State Bank of Pakistan (SBP) will include two years’ history of negative / overdue information (including but not limited to overdue payments, late payments, write-off or reversal of mark-up etc.) in eCIB. You are, therefore, advised to ensure timely payment of your instalment/ Markup to avoid any adverse information being reported or reflected on your e-CIB
A:Clarification: As per IH&SMEFD Circular letter No 21 dated July 10, 2020, service charges for Executing Agencies (EAs) under Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme (PMKJ-YES), with effect from July 1, 2020, will be as under:
|Product||Customer Pricing||Bank Pricing|
|Tier 1||3%||KIBOR (one year offer)+400 BPS|
|Tier-2||4%||KIBOR (one year offer)+400 BPS|
|Tier-3||5%||KIBOR (one year offer)+400 BPS|
Out of this, borrower will pay 3%, 4% and 5% fixed service charges for loans under Tier 1, Tier-2 and Tier-3 respectively. The difference of bank pricing and customer pricing will be borne by the federal government as service charges subsidy. EAs will apply preceding month’s last working day KIBOR for next month’s disbursements. KIBOR once fixed will not change for subsequent disbursements in case of loans disbursed in tranches. KIBOR will be revised after every 12 months.
The procedure for claiming government subsidy on financing under PMKJ-YES is detailed in payment mechanism issued by State Bank of Pakistan (SBP) vide IH&SMEFD Circular Letter No. 1 dated January 3, 2020. Banks working as PMKJ-YES EAs will receive loan repayment from borrowers through equal monthly installments (EMI). However, EAs will receive service charges subsidy from GOP on quarterly basis by submitting subsidy claims to the Director, Development Finance Support Department (DFSD),
A:Clarification: Under PMKJ-YES, loans with maximum tenure of upto 8 years including grace period of upto one year can be provided by EAs. Hence, grace period installments will consist of service charges only. After expiry of grace period the installment will include both the service charges and principal portion till expiry of the loan tenure. In this respect, it may further be noted that for loans disbursed between 1st and 15th of a month, 1st installment will become due on 1st of the next month. However, for loans disbursed between 16th and last day of a month, 1st installment will become due on 1st of the month following next month. Same timelines are to be followed for submission of subsidy claims to SBP.
A:Clarification: Loan expiry date is 1st installment due date plus loan tenor including grace period. Illustration is as under:
|Scenario 1||Scenario 2|
|Disbursement Date||June 14, 2020||June 16, 2020|
|First Installment Due Date||July 01, 2020||August 01, 2020|
|Loan Tenor (Including Grace Period)||5 Years||8 Years|
|Expiry Date||July 01, 2025||August 01, 2028|
A:Clarification: Loan status is to be reported to DFSD on prescribed format as applicable under SBP Prudential Regulations for SME financing and PRs for Agri financing, viz Regular, OAEM, Substandard, Doubtful and Loss.
A:Clarification: GOP service charges subsidy claim will start from first installment due month.
A:Clarification: KIBOR (one year offer) will be reset on loan anniversary and change in KIBOR (one year offer) will be adjusted from 13th installment onward till completion of second year of loan. Similar KIBOR resetting will be done on every loan anniversary installments such as 25th, 37th, 49th, 61st, 73rd and 85th (as per respective loan tenures). Loan anniversary rate change is illustrated in following table.
|Scenario 1||Scenario 2|
|Disbursement date||July 14, 2020||July 16, 2020|
|Applicable 1st year KIBOR||June 30, 2020||June 30, 2020|
|1st installment due date||Aug 01, 2020||Sep 01, 2020|
|13th installment due date||Aug 01, 2021||Sep 01, 2021|
|Applicable loan anniversary KIBOR||June 30, 2021||June 30, 2021|
A:Clarification: EAs will not calculate service charges subsidy for broken period since PMKJ-YES is based on equal monthly installment (EMI) model. Illustration of installments’ calculation considering the broken period is shown in clarification against question 6 above. Service charges subsidy claim will start from 1st installment due month and shall continue either upto expiry of loan or upto settlement of loan or upto classification of loan as “Loss”, whichever condition is applicable.
A:Calculation: Impact of balloon payment will not be reflected in the balloon payment month (because installments are calculated in arrear mode). Thus, impact of balloon payment will be shown in the outstanding and subsidy claim of subsequent months. For fully settled cases, loan status will be mentioned as “Adjusted” in PMKJ-YES Claims Form
A:Clarification: Following forms will be submitted to DFSD, SBP BSC, HO, Karachi on quarterly basis:
The templates of forms have been provided at Annexure A.
A:Clarification: Grace period for loans under PMKJ-YES is upto one year. EAs are encouraged to provide one year grace period to borrowers in order to ease out their cash flow constraints in initial months of the business. However, grace period duration within the maximum permissible period can be mutually agreed by the EAs and the borrowers.
A:Clarification: EMI stands for Equal Monthly Installment. EMI arrangement allows the borrower to repay the same amount every month. During loan tenor, EMI amount will change after every 12 months due to resetting of KIBOR on annual basis. For calculation of 1st EMI and annual resetting of EMI, please see clarification against question 6 above.
A:Clarification: A bank at its own discretion may waive off the processing fee of PKR 100.
A:Clarification: No. It has to be filled online.
A:Clarification: Only one application can be uploaded by an applicant through a single IP against his CNIC.
A:Clarification: Yes. It is part of the non-financial advisory services of the bank to assist applicants in applying for the loan.
A:Clarification: The scheme is principally governed by SBP Prudential Regulations as per type of loan i.e. SE/ME or Agri. and banks shall adhere to all applicable requirements of PRs. However, if any parameter defined in the scheme’s circular by SBP differs from those applicable in SBP PRs, the circular shall supersede the PRs for that particular parameter only. For example, applicability of Turnaround Time and Obtaining LAF & BBFS in this scheme differs from applicable PRs and is defined in the scheme’s circular.
A:Clarification: Debt swapping under the scheme defeats the objective of socioeconomic uplift of SMEs, generation of economic activity and employment generation. Thus, debt swap of outstanding credit facilities of existing customer is not permissible under YES.
A:Clarification: Debt swap of outstanding credit facilities of other banks’ customer is not allowed under YES.
A:Clarification: The initial tenor for working capital loans under PMKJ-YES is one year. Subject to satisfactory repayment behavior and risk profile of the borrower, the bank may allow roll over of the working capital loan annually for seven more years. Here it is pertinent to mention that both short term and long term loans are repayable in equal monthly instalments (EMI). Hence, at the expiry of loan, the performing loans should automatically stand fully adjusted.
A:Clarification: Running finance facility is not allowed under the scheme. Hence, rollover/renewal of working capital loans is allowed subject to observance of terms and conditions as mentioned in SBP response at S. No 19 above.
A:Clarification: Age criteria is for the eligibility of applicant at the time of submission of application only. The scheme’s circular or FAQs do not impose any such limitation on age of the applicant afterward.
A:Clarification: Refer to Q. No. 4 & Q. No. 7 of FAQs, markup subsidy/service charges will start from 1st installment due month and shall continue either up to expiry of loan or up to settlement of loan or up to classification of loan as “Loss” as per applicable PRs. Once a loan is classified as “Loss”, banks shall stop claiming markup subsidy/service charges and will claim credit loss of outstanding principal.
A:Clarification: The scheme provides funded term loan facilities on subsidized markup rates; hence, non-funded facilities do not fall under the purview of YES.
A:Clarification: Refer to Point No. 22 above. Banks are only entitled to receive service charges/markup subsidy (Difference of K+4 and Customer Rate) from 1st installment due month up to settlement of loan or until the loan is classified as “Loss”. In case of default of a borrower at any point in time (i.e. customer stops paying markup), banks will continue to claim markup subsidy (Difference of K+4 and Customer Rate) till loan is classified as “Loss” as per applicable PRs at which point bank will stop claiming service charges and will claim credit loss of principal amount.
The EAs can claim service charges subsidy in subsequent months, if the status of the same loan is revised back to “Regular”. In such cases, loss claimed will be returned to DFSD or the same will be adjusted by EAs by netting it off from the next quarter loss claim/service charges subsidy claim.
A:Clarification: Scheme does not restrict financing to private sector employees/salaried individuals. However, government employees are not allowed to avail financing.
A:Clarification: Yes. A person can apply for loan against his/her personal guarantee. Further, a person being borrower under PMKJ-YES cannot become guarantor for loans to other persons under the scheme.
A:Clarification: The condition of age limit is applicable for individuals and sole proprietors under the scheme. In case of other form of businesses including partnerships and companies, if one of the partner/owners or directors fulfils the age requirement it will be eligible under the scheme to avail financing.
A:Clarification: Disbursements can be made to the borrower or to the supplier as per the agreement between the borrower and the bank.
A:Clarification: Under the scheme, financing is allowed for locally manufactured vehicle only. CBU cannot be categorized as locally manufactured vehicles as these vehicles do not require an assembly before they can be sold out to the buyers.
A:Clarification: Under the scheme, an eligible borrower can avail one loan against his/her CNIC. Besides, loan for one vehicle per borrower is allowed under the scheme.
A:Clarification: The same loan application will be used for Islamic banks/windows.