What are the terms and conditions for Punjab Rozgar Scheme 2020?

Punjab Rozgar Scheme 2020: Those applying for the scheme can obtain loan up to Rs1 million

Web Desk

October 02, 2020

Chief Minister Usman Buzdar launching the Punjab Rozgar Scheme. Photo: Punjab Govt/Twitter

Chief Minister Usman Buzdar on Friday launched the Punjab Rozgar Scheme to boost entrepreneurship and employment in the province.

Those applying for the scheme can obtain up to Rs1 million loans if their businesses are located in Punjab.

The loan process has been made easy and the interested youths could submit their applications through PSIC portal, Punjab Bank website, or Punjab Rozgar App.

Here are the terms and conditions of scheme:

Feature	Description
Loan Limit	Upto Rs. 10.00 Million Clean lending: from Rs. 100,000/- to Rs. 1,000,000/- Secured lending: from Rs. 1,000,001/- to Rs. 10,000,000/- Under Punjab Green Development Program, the limit of a loan will remain the same. However, preference will be given to the micro-enterprises, ready to adopt the environment improving technology, having up to 10 numbers of employees.
Purpose of loan	Setting up of new business Balancing, Modernization and Replacement (BM&R) for existing businesses Working Capital
MSME Sector	Manufacturing, Service, Trading, Agriculture and Live Stock (Environment Friendly / Quality Improving Micro Enterprises as defined above will also be considered under the Punjab Green Development Program)
Processing fee	Rs. 2000/- (non-refundable) at the time of submission of application
Tenure of loan/Repayment Period	From 02 to 05 years including a grace period
Grace period	Up to Six (06) Months (However, the markup will be charged during the grace period)
Type of loan	Term loan as per bank policy and working capital
Cost of Capital	Cost of Capital to be paid by Borrower: 4% for clean lending 5% for secured lending
Debt: Equity	80:20 (For males) 90:10 (Women, Transgender and Differently abled) (Meaning thereby 20% / 10% of the project cost will be invested by the borrower)
Disbursement of loans	In installment(s) as per approved business plan
Security of loan	1. Security for Clean Lending Security for loan limit from Rs. 100,000/- to Rs. 500,000/- Personal Guarantee of the borrower along with net worth statement. Security for loan limit from Rs. 500,001/- to Rs. 1,000,000/- Personal Guarantee of the borrower along with at least one, Third Party guarantor with overall net worth collectively equal to size of the loan applied. (Third Party should be a citizen of Pakistan and resident of the Punjab having a valid CNIC and must not be older than 55 years. Moreover, e-CIB of third party should be clean i.e. it should not have any overdue or write off history) Or Guarantee of Government employee of BS-10 and above alongwith personal guarantee of the borrower. (Departmental gurantee of the government employee will be mandatory) Net Worth / Wealth Description and Calculation Criteria: Net Worth may be in the form of Tangible Asset i.e Property or Vehicle ownership and may be assessed as follows: A. Property may be valued at respective DC rate. Or B. Property valuation may be established from Wealth Tax statement. Or C. Evaluation by Pakistan Banks Association (PBA) approved evaluator/agent Or D. Vehicle valuation shall be invoice price less depreciation (10% for each passing year). 2. Security for loan limit from Rs. 1,000,001/- to 10,000,000/- Mortgage of Assets Asset description A. Residential / Commercial / Industrial / Agricultural Property / vehicle having clean title and clear access (acceptable to the bank) and valued by banks approved appraiser as per bank’s policy. B. The property should be in the name of borrower or blood relative of individual / proprietor / partners. C. Documentation shall be as per bank credit policy / legal division. Charge / hypothecation on fixed / current assets as per internal / external regulations.