Ehsaas Naujawan Interest-Free Loan Program, Pay Back in 8 Years Easy Installments

The Ehsaas Naujawan Loan Program is a special financial support initiative launched by the Government of Khyber Pakhtunkhwa under the broader Ehsaas framework. The aim is to empower unemployed youth, promote entrepreneurship, and reduce poverty by offering interest-free or low-interest business loans.

The Ehsaas Naujawan Loan Program offers a loan amount of 100,000 PKR to 5,000,000 PKR in easy installments of 3 to 8 years without any guarantee.

Key Features of the Program

The Ehsaas Naujawan Loan Program is designed to be accessible and flexible, with two main components managed by different financial institutions:

Small Business Loans (Akhuwat Islamic Microfinance):
- Loan Amount: PKR 100,000 to PKR 500,000.
- Purpose: For starting or expanding small-scale businesses, such as retail, e-commerce, or digital marketing ventures.
- Repayment Terms: 36 to 60 months (3–5 years) with equal installments.
- Budget Allocation: PKR 2 billion for this component.
- Age Eligibility: 18–40 years.
Large Business Loans (Bank of Khyber):
- Loan Amount: PKR 1 million to PKR 5 million.
- Purpose: For medium-scale businesses with high growth potential, requiring a cluster approach (groups of 3–5 individuals).
- Repayment Terms: Up to 8 years with a 20-month grace period during which no repayments are required.
- Budget Allocation: PKR 1 billion for this component.
- Age Eligibility: 18–35 years.
- Debt-to-Equity Ratio: 90:10, where fixed assets or existing business stock can be considered as equity.

Eligibility Criteria

To qualify for the Ehsaas Naujawan Loan Program, applicants must meet the following requirements:

Residency: Must be a permanent resident of Khyber Pakhtunkhwa, including merged tribal districts, verified by a valid Computerized National Identity Card (CNIC).
Age:
- 18–40 years for small business loans (Akhuwat).
- 18–35 years for large business loans (Bank of Khyber).
Business Plan: Applicants must submit a viable, feasible, and sustainable business proposal outlining their idea, goals, and projected outcomes.
Legal Entity: For large loans, applicants must form a registered firm or partnership of 3–5 individuals. Small loans can be applied for individually.
Credit History: Must have a clean repayment record with no defaults, verified through e-CIB (Electronic Credit Information Bureau) or data checks.
Skills and Experience: Preference is given to graduates or skilled individuals with relevant business knowledge. Existing businesses (less than 2 years old) with growth potential are also eligible.
Excluded Businesses: Businesses involved in arms, ammunition, explosives, radioactive substances, security printing, or alcoholic beverages are not eligible, as per the Government of Pakistan’s negative list.

Female entrepreneurs, minorities, persons with disabilities, and madrasa students are particularly encouraged to apply, with dedicated quotas to ensure inclusivity.

Application Process

The application process varies depending on the loan type:

For Small Business Loans (Akhuwat Islamic Microfinance):

Visit a Branch: Applicants must visit the nearest Akhuwat branch (90 branches across 28 districts in KP, including merged districts).
Obtain and Fill Form: Collect the loan application form, provide personal details (name, CNIC, contact information), and submit proof of residency and a business plan.
Document Submission: Submit required documents, including CNIC, proof of residency, and a detailed business proposal.
Review Process: Akhuwat officials review the application for eligibility and feasibility. Approved applicants receive funds, while rejected applicants are informed of the reasons.
Contact: Visit an Akhuwat branch or check www.akhuwat.org.pk for details.

For Large Business Loans (Bank of Khyber):

Online Application: Apply through the Ehsaas Naujawan portal at https://ehsaasnaujawan.bok.com.pk or visit a Bank of Khyber branch.
Prepare Documents: Submit CNIC, proof of residency, a detailed business plan, and registration details for the firm/partnership (3–5 members).
Assessment: The Bank of Khyber evaluates the business plan for sustainability and growth potential. A clean credit history is verified.
Approval and Disbursement: Approved loans are disbursed in tranches, subject to completion of formalities. Applicants are notified within 2–4 weeks.
Contact: Call 091-111-265-265 or visit www.bok.com.pk for assistance.

The application process is designed to be simple and accessible, with online options for large loans and in-person support for small loans to cater to diverse needs.

Conclusion

The Ehsaas Naujawan Loan Program is a game-changer for the youth of Khyber Pakhtunkhwa, offering interest-free, collateral-free loans to turn entrepreneurial dreams into reality. With a PKR 3 billion budget, partnerships with Akhuwat and the Bank of Khyber, and a focus on inclusivity, the program empowers young people to start businesses, create jobs, and contribute to KP’s economic growth.