Ehsaas Naujawan: KP’s Interest-Free Loans for Young Entrepreneurs

The Ehsaas Naujawan Program is the Khyber Pakhtunkhwa government’s interest-free business loan scheme for young entrepreneurs, run with the Bank of Khyber and Akhuwat Islamic Microfinance. It works at two sizes: individuals can borrow Rs 100,000 to Rs 500,000 interest-free through Akhuwat, while groups of three to five young partners with a registered firm can borrow Rs 1 million to Rs 5 million interest-free through the Bank of Khyber, repaid over up to eight years. There is no mark-up in either component. This page explains both routes, the partnership rule that catches many applicants out, and the quotas. KP residents should also know the federal PM Youth Loan Scheme, which lends to individuals at 0 to 7%.

Programme	Ehsaas Naujawan Program, Government of Khyber Pakhtunkhwa
Partners	Bank of Khyber (large loans) and Akhuwat Islamic Microfinance (small loans)
Individual loans	Rs 100,000 to Rs 500,000, interest-free, via Akhuwat
Partnership loans	Rs 1 million to Rs 5 million per firm, interest-free, via Bank of Khyber; up to 8 years, grace up to 20 months
Mark-up	None in either component
Age	18 to 35 years
Apply	ehsaasnaujawan.bok.com.pk for the Bank of Khyber component
Quotas	15% women, 2.5% minorities, 2.5% persons with disabilities, with special consideration for madrassa students

Component 1: Bank of Khyber Loans of Rs 10 Lakh to Rs 50 Lakh

The large component does not lend to individuals at all, and the bank states this plainly. Applicants must form a registered company, partnership or association of persons with at least three and at most five partners, and every partner shares responsibility for the loan. All partners must be 18 to 35, permanent residents of Khyber Pakhtunkhwa including the merged districts, with valid CNICs. The loan of Rs 1 million to Rs 5 million is mark-up free, structured as a term loan over up to eight years with a grace period of up to twenty months, and the amount sanctioned follows the business’s potential and the partners’ file. Government, semi-government and autonomous body employees cannot be partners.

Component 2: Akhuwat Loans of Rs 1 Lakh to Rs 5 Lakh

The small component serves the solo entrepreneur. Through Akhuwat Islamic Microfinance, individuals borrow between Rs 100,000 and Rs 500,000, interest-free, for launching or expanding a small business. This is the route for a single shopkeeper, tradesperson or home-based business that finds the partnership structure unnecessary. Applications run through Akhuwat’s own channels under the programme, with the same KP residency and age spirit, and a viable use for the money.

Who Can Apply for Ehsaas Naujawan?

• Permanent resident of Khyber Pakhtunkhwa, including the merged districts, with a valid CNIC.
• Aged 18 to 35.
• A viable business plan or an existing business to expand.
• No default history with financial institutions.
• For the Bank of Khyber component: a registered firm of 3 to 5 partners, all meeting the age and residency rules, and none a government employee.

Reserved quotas widen the door: 15% for women, 2.5% for minorities and 2.5% for persons with disabilities, with special consideration for students of religious seminaries, alongside applicants from less developed districts.

How to Apply

1. Decide your component by size: up to Rs 500,000 individually via Akhuwat, or Rs 1 million and above as a partnership via the Bank of Khyber.
2. For the partnership route, register your firm first and agree the partners’ shares and responsibilities in writing; the bank will ask.
3. Apply online at ehsaasnaujawan.bok.com.pk for the Bank of Khyber component when the application window is open; windows run in announced rounds.
4. Submit the business plan and documents; the bank appraises the case with the partners.
5. On approval, the loan is disbursed to the firm, and repayment starts after the grace period.

Because rounds open and close, an applicant who misses a window should keep the firm, plan and documents ready rather than paying anyone who promises an out-of-window entry; there is none.

Ehsaas Naujawan or PM Youth Loan: Which Fits a KP Applicant?

• Ehsaas Naujawan: KP only; fully interest-free at every size; individuals capped at Rs 500,000 (Akhuwat); larger money demands a 3 to 5 partner registered firm.
• PM Youth Loan Scheme: federal; individuals can borrow up to Rs 7.5 million; only the first Rs 500,000 is interest-free, with 5% and 7% tiers above.

A solo KP founder needing Rs 2 million interest-free cannot get it from either scheme alone: the honest options are forming a genuine partnership for Naujawan, or taking the federal Tier 2 loan at 5%.

Ehsaas Naujawan Program: FAQs

Before you apply, take one practical step that improves most cases: build a simple one page plan that states what you will sell or make, who will buy it, what the loan will buy, and how monthly sales will cover repayment after the grace period. Keep receipts and bank statements tidy, agree partner roles in writing before registration, and check that every partner meets the age, residency and employment rules before you submit anything. If a partner later becomes a government employee or leaves the firm, ask the lender how that change affects the loan rather than assuming the original approval still stands. Do not pay an agent who claims to guarantee approval, speed up a file, or open a closed round, because the programme does not work that way and such payments are a common way for applicants to lose money. Use only the official Bank of Khyber portal for the partnership component and Akhuwat channels for the small loans, keep copies of every form and receipt, and note the dates of each round so you can prepare early for the next one. A well prepared, honest application with a realistic plan gives a young business a far better start than a rushed file built around a loan size the business cannot support.

Keep exploring: Business Loan Schemes · Khyber Pakhtunkhwa Schemes · All Government Schemes

Last updated: November 4, 2026