BB to offer young entrepreneurs Tk 20 lakh in loan, grant

Young entrepreneurs will soon be able to get up to Tk 20 lakh in loans and grants combined to start businesses, without providing any collateral, under a new Bangladesh Bank programme.

The initiative, named UDYOG: Upazila-based Young Entrepreneur Identification, Selection and Financing Programme, aims to encourage entrepreneurship at the grassroots level and create jobs, the BB said at a press conference yesterday at its Dhaka headquarters.

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Under the programme, banks will identify promising young entrepreneurs at the grassroots level, assess their business ideas and financing needs, and provide financial support.

As per the announcement, each selected entrepreneur will be eligible for up to Tk 20 lakh, depending on need. Half of the package will be a bank loan, the other half a grant.

The interest or profit rate on the loan portion will range from 4 to 7 percent, and borrowers will not need to provide collateral, BB said.

However, if a borrower fails to repay within the stipulated period, the grant portion will be converted into an interest-free loan, the central bank added. The loan account will then be classified under existing rules, and the borrower will be considered a defaulter, becoming ineligible for further loans.

Beyond financing, selected entrepreneurs will receive training, mentorship, help with registration and business plans, and market-linkage support to help create jobs and drive economic growth, BB Spokesperson Arief Hossain Khan said.

Business initiatives across agriculture, food processing, handicrafts, fisheries, livestock, tourism, services and technology will be considered.

BB said it will issue a circular on September 16, after which applications can be submitted at any bank branch at the upazila level using a prescribed form. Applicants will have one month to apply.

Bangladeshi citizens aged 28 or below on the final application date, residing in the relevant upazila, will be eligible without prior business experience, provided they have a viable business idea.

The programme will launch across 64 upazilas in eight districts — Manikganj, Feni, Naogaon, Jhenaidah, Bhola, Habiganj, Rangpur and Netrokona — selecting 10 entrepreneurs per upazila, for an initial total of 640.

BB said it will later expand the programme nationwide, targeting 5,000 entrepreneurs annually.

The scheme has an initial fund of Tk 500 crore, with funds to be sourced from the corporate social responsibility (CSR) accounts of banks to establish a separate, regulated grant fund.