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Bangladesh Bank on Sunday launched a comprehensive financing programme titled “Udyog: Upazila-Driven Youth Opportunity for Growth” to promote self-employment and grassroots economic growth by identifying and financing prospective young entrepreneurs across all upazilas.
The guideline, issued by the central bank’s SME and Special Programmes Department, directs the managing directors and chief executive officers of all scheduled banks to implement the scheme immediately.
The programme covers a wide range of legal ventures, including technology startups, agriculture, food processing, light engineering, renewable energy and handicrafts. It prioritises both innovative business ideas and existing business models.
To ensure funding reaches genuine and capable young entrepreneurs, Bangladesh Bank has set specific eligibility criteria.
Applicants must be adult Bangladeshi citizens aged up to 28 years on the final date for submitting applications and must be permanent residents of the respective upazila.
They must also have a clean credit history. Any default status found during Credit Information Bureau (CIB) checks will result in immediate cancellation of the application.
Applicants who have previously taken a business loan from any bank or financial institution are also ineligible. Employees of public, semi-government and autonomous institutions cannot apply.
To reduce financing barriers for young entrepreneurs, loans under the programme can be disbursed without collateral.
The framework offers a maximum blended financing package of up to Tk20 lakh for each selected entrepreneur, based strictly on business requirements and proposed costs.
The financing will comprise 50% bank loan, up to Tk10 lakh, and 50% matching grant, up to Tk10 lakh.
For example, if a business requires Tk 12 lakh, the applicant will receive Tk 6 lakh as a bank loan and Tk6 lakh as a grant.
The loan and grant portions will be disbursed simultaneously into the recipient’s bank account.
However, failure to repay the loan or misuse of the funds will automatically convert the grant portion into an interest-free debt, recoverable under existing recovery laws.
Bangladesh Bank will nominate a Lead Bank for each upazila to execute and coordinate the programme.
Any branch of a scheduled bank will collect application forms. On the working day following the application deadline, branches will forward all applications to the respective Upazila Lead Bank, which will then send them to the District Lead Bank and ultimately to the relevant Bangladesh Bank departmental offices.
A multi-stakeholder panel comprising central bank officials, representatives of scheduled banks, successful entrepreneurs, industry leaders and academics will evaluate business plans based on factors including market feasibility and employment potential before making the final selections.
Designated banks must sanction the loans within 15 working days of final selection, in line with their internal credit policies and Bangladesh Bank regulations.
Participating banks will also provide financial literacy training, mentoring, market-linkage support and assistance with business registration to help ensure the long-term sustainability of the newly established enterprises.
