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December 31, 2019

Islamabad disburses Rs500mln interest-free loans in Sindh


December 31, 2019

KARACHI: The government has disbursed interest-free loans of half a billion rupees to marginalised people of Sindh to establish small-scale businesses and help them come out of poverty shackle.

Governor Sindh Imran Ismail distributed the cheques amongst the beneficiaries during a ceremony on Monday. The interest-free loans were rolled out to more than 15,000 borrowers in 10 lagging districts of Sindh under the ‘Ehsaas strategy’, which is a part of the national poverty graduation initiative. Seventy percent of borrowers are women. The initiative is funded by the government, International Fund for Agricultural Development and the Asian Development Bank.

Launched in March 2019, Ehsaas is the country’s biggest program for poverty mitigation, which aims to collaborate with all stakeholders — public, private, civil society, philanthropists, and expatriates towards poverty alleviation. Pakistan Poverty Alleviation Fund (PPAF) and Akhuwat Foundation are executing the program.

Overall, interest-free loans worth Rs13.8 billion have been disbursed to 413,390 borrowers – of which 46 percent are women – across the country. Ismail said millions of households in Pakistan suffer from extreme poverty and they are unable to access basic necessities of life.

“Ehsaas program’s interest-free loan program can help them forge a better future for themselves. It is our government’s priority to serve the underprivileged sector of Pakistan and through the Ehsaas program we envision to drive millions out of the circle of poverty,” a statement quoted him as saying. “This initiative will not only allow us to create employment opportunities but will also be crucial towards economic prosperity.”

The government earmarked Rs42.65 billion for 100 districts across the country under the Ehsaas program. The amount will impact 16.28 million people with half of them women including youth, persons with disabilities, transgender, minorities and marginalised communities.

As many as 3.8 million interest-free loans would be provided to 2.28 million households during the next four years and 14.7 million people would be beneficiaries.

Qazi Azmat Isa, chief executive officer of PPAF hoped that such initiatives would help bring major transformation in the lives of the poor.

“Societies can only thrive if people work in collaboration to uplift each other,” Isa said. “Ehsaas program is one such example of a fruitful partnership which shall immensely benefit the people of Pakistan.”

Simi Kamal, head of Programs at PPAF said the national poverty graduation initiative aims to steer the poorest of households out of poverty by providing them interest-free loans, helping them to establish small scale businesses to improve their economic conditions.

Kamal said 80,000 interest-free loans are being disbursed every month while the maximum loan size is Rs75,000. National poverty graduation initiative has three major components and will provide relief to the masses through asset transfers, vocational and skills trainings and interest-free loans.

Total 225,000 assets will be provided to the poorest of the poor to start their businesses. The average cost of the asset, which will be given as a grant, is Rs50,000. The asset recipients would be provided business trainings to draw maximum benefit from the asset provided to them. More than 9,000 assets would be distributed every month over the next two years. Total 1.45 million people would benefit from the asset transfer scheme. Recipients of asset transfer and interest-free loans would be provided skills, business development and financial literacy trainings as needed to ensure sustainable livelihoods.

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