Bangladesh Bank is launching a new program to develop young entrepreneurs at the upazila level and finance their business ventures. Under “Uddog — the Upazila-Based Young Entrepreneur Search, Identification and Financing Program,” each selected entrepreneur will receive financing of up to 2 million taka. Half of that will be a bank loan, with the remaining half provided as a grant. No collateral will be required for the loan.
Bangladesh Bank announced the program in a press release Thursday.
The central bank said Uddog is not a competition in the conventional sense. Under the program, scheduled banks will use their existing branch networks to identify promising young entrepreneurs at the upazila level. Their business ideas and actual financing needs will then be assessed to arrange funding.
Half loan, half grant
Each selected entrepreneur will receive a financing package of up to 2 million taka based on their actual needs. Half of that will be a bank loan, with the remaining half provided as a grant.
The interest or profit rate on the loan for customers will be a maximum of 4% to 7%. No collateral will be required for the loan.
However, if the borrower fails to repay the loan on schedule, the grant portion will be converted into an interest-free loan. In that case, the loan account would be classified under standard rules, and the borrower would be considered a defaulter, losing eligibility for future loans as well.
Who can apply
Adult citizens who are no older than 28 as of the application deadline and who reside in the relevant upazila will be eligible to apply for the program.
Prior business experience is not required. Applicants only need a realistic business idea to apply.
All legitimate ventures will be considered equally, including agriculture and food processing, handicrafts, fisheries, livestock, tourism, services and technology-based businesses.
There is no application fee. Applications can be submitted using a prescribed form at any scheduled bank branch in the relevant upazila.
Applications open in September
A circular with detailed guidelines for implementing the program will be issued on Sept. 16. Applications will be open for one month after the circular is issued.
640 entrepreneurs in the first phase
The program will initially launch in 64 upazilas across eight districts in eight divisions: Manikganj, Feni, Naogaon, Jhenaidah, Bhola, Habiganj, Rangpur and Netrokona.
Ten young entrepreneurs will be selected from each upazila, for a total of 640 in the first phase. The program will be gradually expanded to upazilas in other districts.
Bangladesh Bank aims to finance and support 5,000 young entrepreneurs each year.
Training alongside financing
Bangladesh Bank said the program will not be limited to financing alone. Selected entrepreneurs will receive entrepreneurship development training and ongoing guidance from experienced mentors.
They will also receive support with business registration and business-plan development, along with market-linkage opportunities.
According to Bangladesh Bank, a successful small entrepreneur typically creates three to five jobs. With that in mind, the central bank expects the Uddog program to play an important role in creating new employment and in the country’s overall economic development.