PM Youth Loan Scheme limit raised to Rs25 million, minimum age cut to 18: what a loan costs

PM Youth Loan Scheme 2026: Prime Minister Shehbaz Sharif on Sunday raised the most a single borrower can take under the Prime Minister's Youth Business and Agriculture Loan Scheme (PMYB&ALS) from Rs7.5 million to Rs25 million, and lowered the minimum age for applicants from 21 to 18, Radio Pakistan reported after a review meeting in Islamabad. He also ordered that 30 per cent of the loans be kept for women, up from the 25 per cent the scheme's bank pages state today.

The government has set aside Rs292 billion for these loans in 2026-27 and expects about 266,700 young people to borrow this year, The Express Tribune reported from the meeting's briefing. Since January 2023, 581,341 people have received loans worth Rs313.9 billion.

What changed on Sunday

The prime minister also told the Small and Medium Enterprises Development Authority (SMEDA) to give borrowers help with business plans, consultancy and technical support, and asked for a countrywide awareness campaign.

What the loans cost today

The meeting's statements did not give a markup rate, tenor or security rule for the new range above Rs7.5 million. Until the State Bank publishes revised scheme rules, the tiers banks show are these, as listed on HBL's scheme page:

• Tier 1: up to Rs500,000 at 0%, personal guarantee, repaid over up to 3 years.
• Tier 2: Rs500,000 to Rs1.5 million at 5%, personal guarantee, up to 8 years.
• Tier 3: Rs1.5 million to Rs7.5 million at 7%, collateral under the bank's policy, up to 8 years.

Startups put in 10% of the cost themselves on Tiers 1 and 2 and 20% on Tier 3; existing businesses put in nothing. One person can hold two loans (one short-term, one long-term) within the overall limit.

What a loan would cost you each month

We ran the current tiers through the standard instalment formula, ignoring the grace period:

• Rs500,000 at 0% over 3 years: about Rs13,889 a month, no markup.
• Rs1.5 million at 5% over 8 years: about Rs18,990 a month, roughly Rs323,000 in markup in total.
• Rs7.5 million at 7% over 8 years: about Rs102,253 a month, roughly Rs2.32 million in markup.

Try your own amount and term on our personal loan calculator. Banks may set the exact schedule differently, so ask for the repayment plan in writing.

How to apply

1. Check you hold a valid CNIC and fall in the age range (the new minimum of 18 applies once banks update their rules).
2. Write a short business plan: what you will sell, the cost, and how the loan is repaid.
3. Apply online at the scheme portal, pmyp.gov.pk, and choose your bank.
4. Keep your credit record clean: the SBP reports late payments to eCIB for two years, HBL's page warns.

What to watch

The higher limit and the lower age take effect for borrowers only when the State Bank and the banks issue revised scheme terms. We will update this page with the markup for loans above Rs7.5 million when it is published.

For other financing, see our home loan calculator and car financing calculator.