Deal signed between National Bank of Pakistan, Utility Stores Corporation for Prime Minister’s Youth Business Loan Scheme

Karachi, April 06, 2015 (PPI-OT): National Bank of Pakistan (NBP) joined hands with the Government of Pakistan in the Prime Minister Youth Business Loan Scheme with an objective to support, develop and promote Small and Medium Enterprises (SMEs) by providing them the necessary technical and financial assistance. To enable SMEs to play a vital role in stimulating GDP growth, create job opportunities for the unemployed youth of Pakistan and reduce poverty.

NBP has made another stroke in the PMYBL program and signed a Memorandum of Understanding (MOU) with Utility Stores Corporation (USC) during a graceful ceremony held at NBP Regional Head office in Islamabad.

Under this arrangement USC and NBP have agreed to enter into this MOU with a focus on self-employment of unemployed educated youth within the age brackets of 21-45 years. The applicant will become a part of the USC franchise and NBP will facilitate the financing. The franchisee has to be the resident of the same proximity intended for their businesses, and must have acquired minimum middle education. This MOU between both organizations will assist applicants with no expertise but willingness to set up their own business.

The focus of USC is to provide the franchisee with an opportunity to develop his/her own financial standings by passing 80% of gross Profit to the franchisee. One applicant can get only one license, subletting of Franchise Utility store is not permitted. The correct utilization of funds in business will be mitigated since all the purchases from USC will be documented and provided to NBP, if required. The minimum distance between the existing Utility Store franchise or other regular stores is 0.5km mandatory.

The representatives of National Bank at this MOU Signing ceremony were Mr. Mudassir H. Khan – SEVP and Group Chief, Commercial and Retail Banking Group (C and RBG), Mr. S. H. Irtiza Kazmi – EVP and Coordinator – PMYBL, C and RBG, Ms. Nageen Rizvi – VP and Unit Head Marketing and Promotions PMYBL, C and RBG. From USC Dr. Mukhtar Ahmad – Managing Director, Mr. Masood Alam Niazi – Senior General Manager Franchise and other officials were present.

The Group Chief and SEVP National Bank of Pakistan, Mr. Mudassir Khan stated that the small business they are a critical component of and major contributor to the strength of local economies. Small businesses tend to attract talent who invent new products or implement new solutions for existing ideas.

Larger businesses also often benefit from small businesses within the same local community, as many large corporations depend on small businesses for the completion of various business functions through outsourcing. Small businesses present new employment opportunities and serve as the building blocks of Pakistan’s largest corporations.

Talking to a correspondent, Mr. Mudassir Khan sounded very optimistic and said that the most significant initiative taken by the government for the development of the SMEs is the establishment of PMYBL Scheme and engaging the banks to arrange speedy financial assistance for them. It was felt that the growth of SMEs was mainly hampered by non-availability of credit facilities.

He said that through the PMYBL scheme the decisions are taken purely on merit and in order to ensure proper and productive utilization of the Banks financing, Business Support Services will also be provided to eligible applicants. Mr. Irtiza Kazmi, the Executive Vice President and the Coordinator for PMYBL said that improving financial access for SMEs is expected to bring many benefits, including enhancing production quality, increasing new business opportunities, stimulating investment and consumption at the national level, and mobilizing savings.

Financing the SME cluster will also improve the business efficiency of smaller export-oriented manufacturers. Enhancing access to finance for subcontracted SMEs will promote intraregional trade. These policy oriented measures at the national level are expected to indirectly accelerate global rebalancing. Furthermore, establishing financial infrastructure to support and enhance small enterprises will stimulate income gains in low-income households and thus contribute to poverty alleviation, social welfare enhancement, and even the development of future corporate base.

Mr. Kazmi added that NBP being the largest public sector bank has always lead the way in product innovation and penetrating the hitherto neglected market segments. While sharing the commitment of the Government towards uplifting the youth and providing them opportunities of financial independence through self-employment, NBP has yet again demonstrated its lead position by leading the Prime Minister’s Youth Business Loan program.

Ever since the announcement of Prime Minister’s Youth Business Loan (PMYBL) program under the aegis of the State Bank of Pakistan and the Ministry of Finance, NBP has made significant progress in successfully implementing this scheme. Until now, over 5,811 successful applicants have been provided loans, collectively amounting to over PKR 4.15 Billion. NBP is confident that this program, apart from being beneficial for the bank, will also facilitate the SMEs in leading a positive multiplier effect, thereby yielding sustainable economic growth.

Utility stores Corporation (USC) was established in July 1971, by taking over 20 retail outlets from the Staff Welfare Organization. Passing through various stages of expansion and reorganization, the Corporation at present is operating 5,939 stores throughout the Country.

USC operates with an objective of generating Self employment opportunities through Public-Private Partnership. It requires low investment and high return, 80% of the Gross Profit is passed on to the Franchisee. This arrangement will assist in generating opportunities, Poverty alleviation and expanding the network of USC.

NBP is encouraged by the inclusion of USC as alliance partner into this program. Both institutions are confident that this alliance will go a long way in enhancing the mutual objectives under this MOU and will provide further opportunities to the prospective unemployed youth.

For more information, contact:
Syed Ibne Hassan
Vice President / Divisional Head (A)
National Bank of Pakistan (NBP)
Corporate Communication and Brand Management Division
Head Office, NBP Building, I.I. Chundrigar Road,
Karachi, Pakistan
Tel: +92-21-99220773
Cell: +92-300-8202184
Fax: +92-21-99212734

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