Bangladesh Bank to give Tk20 lakh without collateral to young entrepreneurs

Bangladesh Bank has started a new programme to help young people start businesses, create jobs and support the rural economy. Under the programme, selected young entrepreneurs can get up to Tk20 lakh without collateral. Half will be a bank loan and the other half will be a grant.

The central bank issued the policy for the programme on (September 13) Sunday. All scheduled banks have been asked to implement it.

The programme covers legal businesses such as tech startups, farming, food processing, light engineering, renewable energy and handicrafts. Both new and existing businesses can apply.

Who can apply

Applicants must be 28 years old or younger on the last date of application. They must be Bangladeshi citizens and permanent residents of the relevant upazila.

Loan defaulters cannot apply. People who have already taken a business loan from a bank or financial institution are also not eligible. Government, semi-government and autonomous body employees are excluded.

Half loan, half grant

An entrepreneur can get up to Tk20 lakh, depending on the business needs. Up to Tk10 lakh will be a bank loan, while another Tk10 lakh will be given as a grant.

For example, if a business needs Tk12 lakh, the entrepreneur will get Tk6 lakh as a loan and Tk6 lakh as a grant.

Both amounts will be deposited into the entrepreneur’s bank account at the same time.

If the entrepreneur fails to repay the loan or misuses the money, the grant will also be turned into an interest-free loan and recovered under existing laws.

How they will be selected

Bangladesh Bank will choose a lead bank for each upazila. Applicants can collect and submit forms at any scheduled bank branch.

The selection will be based on the business plan, market potential and ability to create jobs.

A panel of Bangladesh Bank officials, bank representatives, successful entrepreneurs, industry representatives and academics will select the entrepreneurs.

The selected entrepreneurs will get loan approval within 17 working days.