Collateral free-loan to promote self-employment and entrepreneurship development in Bhimdatta MunicipalityThe collateral-free scheme is for those who want to start productive businesses under the Mayor Entrepreneurship Development Programme.
In its bid to promote self-employment and entrepreneurship development targeting unemployed citizens and returnees from India and overseas, Bhimdatta Municipality in Kanchanpur has launched a programme that creates investment opportunities by providing collateral-free loans.
According to the municipality, the collateral-free scheme is for those who want to start productive businesses under the Mayor Entrepreneurship Development Programme. On Thursday, the Mayor of Bhimdatta Municipality, Surendra Bista, and Mahendranagar branch manager of Nepal Bank Limited signed an agreement to implement the programme.
According to Bista, the municipality is going to establish a fund for the programme in the bank.
“We will soon make an announcement for applications with a business plan. The selected applicants will also receive training for entrepreneurship development. Officials of the municipality and representatives of the bank will select the applicants. The bank will provide Rs 100,000 to Rs 500,000 to the selected applicants without seeking collateral from them.”
One hundred unemployed youths will benefit from the programme in the first phase, according to Bista.
The municipal office had collected data of overseas returnees, mostly from India, from various quarantine facilities between March and April. By then, around 1,100 people had expressed interest to start a business of their own, provided they received collateral-free loans from financial institutions. “The objective of the programme is to promote self-employment and also utilise skills of the returnees,” said Bista.
The municipality plans to continue the programme in the next fiscal year if the first phase of the programme becomes successful. Every year, the municipality has been spending Rs 30 to Rs 40 million in various types of subsidies. “We can pay bank loans from the same amount now,” said Bista, adding that they have prioritised agricultural productions and also non-agricultural products under the Mayor Entrepreneurship Development Programme.