Punjab CM approves ‘Assan Karobar Finance’ scheme

LAHORE: Punjab Chief Minister Maryam Nawaz Sharif has approved the multibillion CM Punjab Assan Karobar Finance’ scheme aimed at fostering economic growth and empowering small and medium-sized entrepreneurs in Punjab.

The programme, which offers financial assistance to businesses across various sectors, will be approved by the Punjab cabinet tomorrow (Tuesday). The scheme is designed to catalyse job creation, enhance exports and promote economic development in the region through interest-free loans and comprehensive support.

The Assan Karobar Finance scheme will assist entrepreneurs in establishing new businesses, expanding existing operations and modernising their setups through funding for working capital, balancing, modernisation, replacement (BMR) of machinery and leasing of commercial logistics. This initiative is open to all sectors, including agricultural SMEs, and is aligned with the regulations set forth by the State Bank of Pakistan (SBP).

The scheme is structured into two tiers based on the loan amount. Tier-1 offers unsecured loans of up to Rs5 million, requiring personal guarantees, while Tier-2 provides secured loans ranging from Rs5 million to Rs30 million. To qualify, applicants must meet several criteria, including being between 25 and 55 years of age, having a clean credit history, and owning or renting the business premises. The repayment period spans up to five years, with a grace period of six months for new businesses (Greenfield) and three months for existing businesses (Brownfield).

In addition to the financing scheme, the government has also introduced the Punjab CM Assan Karobar Card, a digital solution designed to facilitate small entrepreneurs in the province. This card offers interest-free loans up to Rs1 million for a tenure of three years, with a grace period of three months. The funds are strictly allocated for business-related activities through digital platforms such as mobile apps and point-of-sale systems, ensuring that the loan is used effectively for its intended purpose. This initiative is expected to benefit over 100,000 small businesses in the province.

The scheme also comes with several additional incentives to ensure the success of entrepreneurs. These include a capital subsidy of up to Rs5 million for solar equipment and cleaner production technologies, non-financial advisory services, and the development of new small industrial estates in key areas such as Sialkot, Gujrat, and Quaidabad. The establishment of these estates, with long-term leases of up to 30 years, will provide entrepreneurs with affordable plots, enabling them to set up and expand their businesses without bearing the high costs of land acquisition. Moreover, a special focus is being placed on the tannery sector in Sialkot, with plans to relocate tanneries to a dedicated Tannery Zone to reduce water pollution and enhance the quality of leather exports.

Looking ahead, the government is planning Phase-II of the Punjab CM Assan Karobar Finance scheme, with an extended scope at a cost of Rs100 billion set to launch in the next fiscal year (2025-26). This phase will further accommodate around 24,000 SMEs, with a total loan disbursement portfolio of Rs379 billion, driving continued growth and development across the province.

Through these efforts, the Punjab government is not only providing financial support but is also creating a robust ecosystem for SMEs to thrive. With interest-free loans, technical expertise and favorable infrastructure developments, the Punjab CM Assan Karobar Finance scheme is set to transform the entrepreneurial landscape in the province, paving the way for a more prosperous future.