Loan Features of Gilgit-Baltistan E-Rozgar Scheme 2022

    

    Gilgit-Baltistan e-Rozgar Scheme, a flagship initiative of the Government of the GB under CM initiatives has been designed with a total cost of Rs. 100.00 million (Rupees Ten Crore only) to provide subsidized loans to the micro, small and medium (MSMEs) Information Technology startups and existing business in IT Sector in collaboration with Commercial Banks. The government of the GB will provide Markup Support and Risk Coverage to minimize the cost of commercial loans for the MSMEs, and to overcome the pandemic effect of COVID-19 on existing business.

S. No	Particulars	Gilgit-Baltistan E-Rozgar Scheme 2022
1	Eligibility Criteria	All men/women holding CNIC, aged between 18 and 45 years with entrepreneurial potential in IT Sector are eligible. For IT/E-Commerce related businesses, at least matriculation or equivalent education will be required.
2	Loan size	Size of the loan is segregated into three tiers, as under: Tier 1 (T1) loans- Rs 0.1 million to Rs. 1 million Tier 2 (T2) loans- Above Rs 1 million and up to Rs 3 million
3	Loan type	Long Term Loan for Machinery and Equipment Working Capital Loan/ Running Finance
4	Loan Tenor	Up to 3 years
5	Debt: Equity ratio	For New Businesses: Tier 1 - 90:10 Tier 2 - 80: 20 The borrower’s contribution of equity would be in the form of cash or moveable or immovable property and will be required after approval of loan.
6	Focus on Women	25% of the loans will go to women borrowers. In case of unavailability of women the case will be diverted to male.
7	Security Requirements	Security arrangements will be as under: T1 loans: Clean; however two personal guarantee of the borrower including one government servant T2 loans: As per bank’s own credit policy
8	Risk Mitigation	Bank will bear credit losses if any
9	Allocation in Budget	Rs 100 million have been allocated by GB Government which will be transferred to successful bank as per agreement on the terms and conditions given RFP.
10	Pricing	Pricing for Working Capital & Term Loans: Product Customer Pricing Tier 1 Not exceeding 6% Tier 2 Not exceeding 6%
11	Executing Agency	Will be selected as per procedure after approval of Government.
12	Sectors and Products	Information Technology Sector only
13	Application Form	The Form would be both in English and Urdu and require minimum essential information with simple format. Once scheme is launched, agreement will be signed with executing agency (bank) with the approval of Government. Applications will be invited from candidates.
14	Monitoring	Respective bank will publish consolidated information about the loans extended under this program for information of the public on quarterly basis. Monitoring mechanism will be defined by IT Department and successful bank with mutual agreement.
15	Geographical Distribution	Whole of Gilgit-Baltistan.
16	Additional Measures	Executing Agencies (EAs) under this program should ensure following additional measures: In case of loan for existing businesses, a robust independent verification mechanism may be introduced to ensure proper utilization of loans. Further, for new businesses, a robust mechanism for ongoing monitoring of the loans’ utilization should be developed and implemented.