PM Youth Loan Scheme Limit Raised to Rs25m, Age Cut to 18

Prime Minister Shehbaz Sharif has raised the maximum loan under the PM Youth Loan Scheme, formally the Prime Minister’s Youth Business and Agriculture Loan Scheme, from Rs7.5 million to Rs25 million. He also lowered the minimum age for applicants from 21 to 18, a change that opens the programme to students and early-career founders who were shut out until now.

The decisions came at a review meeting the prime minister chaired on Sunday, November 8, 2026. Finance Minister Muhammad Aurangzeb, Special Assistant on Youth Affairs Rana Mashhood Ahmed Khan and Special Assistant on Political Affairs Talha Burki attended. The government has also reserved 30 percent of loans for women.

What the PM Youth Loan Scheme changes mean

The new ceiling is more than three times the old one. Under the rules the State Bank of Pakistan (SBP) issued in December 2022, a borrower could hold up to two loans at once, but only within an overall cap of Rs7.5 million. The prime minister has now directed that the individual limit go up to Rs25 million, repayable in instalments.

According to figures shared at the meeting, 581,341 young people have received loans worth about Rs313.9 billion since January 2023. That is roughly ten times the number of beneficiaries in the ten years before. For FY2026-27, the government has allocated Rs292 billion and expects to reach around 266,700 young borrowers.

The prime minister also directed the Small and Medium Enterprises Development Authority (SMEDA) to give borrowers help with setting up a business, consultancy and technical support. A nationwide awareness campaign has been ordered so that eligible young people know the scheme exists.

Why it matters for tech founders and freelancers

For IT businesses, the age change is narrower than it first looks. The SBP’s existing rules already allowed applicants aged 18 and above if they were starting an IT or e-commerce business, as long as they had at least a matriculation certificate. Everyone else had to be between 21 and 45. The new decision extends the lower age to all young applicants, which matters for teenage founders whose business mixes tech with trade, services or agriculture.

The bigger shift for the tech sector is the size of the ticket. Rs7.5 million was enough for a laptop-and-desk setup or a small e-commerce store. Rs25 million is closer to what a small software house, a design studio or a growing Shopify brand needs to hire a team, rent an office and carry working capital while it waits for clients to pay.

TechJuice noted that Pakistan’s freelancers earned a record $1.76 billion in FY2025-26, with most of that growth coming from individuals working alone. Easier access to larger loans could help some of them turn solo freelancing into registered companies that employ others.

Current tiers, markup and collateral

The government has not yet announced how the Rs25 million ceiling will be split into tiers, or what markup will apply above Rs7.5 million. Until the SBP issues revised instructions, the published structure is the one set out in its 2022 circular:

• Tier 1: up to Rs0.5 million, markup-free, repayable over a maximum of three years. Personal guarantee only.
• Tier 2: above Rs0.5 million to Rs1.5 million at 5 percent markup. Clean loan with a personal guarantee.
• Tier 3: above Rs1.5 million to Rs7.5 million at 7 percent markup. Security follows the lending bank’s own credit policy.

Long-term loans under Tiers 2 and 3 run for up to eight years, including a grace period of up to one year. Working capital loans run for up to five years. New businesses must put in equity of 10 to 20 percent depending on the tier, while existing businesses need no equity contribution. Any vehicle financed under the scheme serves as collateral.

These figures are the rules in force today. Founders planning for a loan above Rs7.5 million should wait for the SBP’s notification before assuming the same rates or security terms will apply.

How to apply and which banks lend

Applications go through the Prime Minister’s Youth Programme portal at pmyp.gov.pk, through its online application form. The SBP circular sets a non-refundable processing fee of Rs100 and a 45-day window for banks to decide on an application. One person can submit a maximum of two applications per CNIC.

The scheme is open to all commercial and Islamic banks, and microfinance providers handle many Tier 1 loans. Banks that run dedicated pages for the PM Youth Loan Scheme include HBL, Bank of Punjab, MCB Bank, Bank Alfalah, Askari Bank, Soneri Bank, Bank AL Habib and First Women Bank. Applicants need a valid CNIC, and larger Tier 3 loans are subject to each bank’s own security requirements.

What to watch next

The announcement is a directive from the prime minister. The detailed operating rules for the higher limit, including new tiers, markup and security requirements, are expected to come from the SBP and the finance ministry. Until then, banks will keep processing applications under the current Rs7.5 million framework. ITInsider will update this story when the revised PM Youth Loan Scheme rules are published.

Key facts

• Maximum loan raised from Rs7.5 million to Rs25 million, announced on November 8, 2026.
• Minimum age lowered from 21 to 18; IT and e-commerce applicants could already apply at 18.
• 30 percent of loans reserved for women.
• Rs292 billion allocated for FY2026-27, targeting about 266,700 young borrowers.
• 581,341 young people have received loans worth about Rs313.9 billion since January 2023.