Young entrepreneurs in Bangladesh will soon have the opportunity to access up to Tk 20 lakh in loans and grants without the need for collateral to kickstart their businesses. This initiative, known as UDYOG, is geared towards fostering entrepreneurship at the grassroots level and facilitating job creation, according to a recent announcement by the Bangladesh Bank.
Under the UDYOG programme, financial institutions will identify and support promising young entrepreneurs by evaluating their business proposals and financial requirements. Each selected entrepreneur will be eligible for a combined sum of up to Tk 20 lakh, with half of the amount provided as a loan and the remaining half as a grant.
The interest or profit rates on the loan component will vary between 4 to 7 percent, and borrowers will not be required to offer any collateral. In the event of default, the grant portion will be converted into an interest-free loan, leading to the borrower being classified as a defaulter.
Apart from financial assistance, the selected entrepreneurs will benefit from training, mentorship, assistance in business registration and planning, as well as support in connecting with markets. The programme will encompass various sectors including agriculture, food processing, handicrafts, fisheries, livestock, tourism, services, and technology.
Bangladesh Bank plans to release a circular on September 16, marking the commencement of the application process at the upazila level through designated bank branches. Eligible applicants must be Bangladeshi citizens aged 28 or below, residing in the respective upazila, and possessing a viable business concept, even without prior entrepreneurial experience.
Initially, the programme will be rolled out in 64 upazilas across eight districts, targeting 10 entrepreneurs per upazila for a total of 640 beneficiaries. The scheme, which has an initial fund of Tk 500 crore sourced from banks’ corporate social responsibility accounts, aims to expand nationwide, supporting 5,000 entrepreneurs annually.
