Bangladesh Bank has launched a comprehensive youth entrepreneurship funding scheme titled “Udyog: Upazila-Driven Youth Opportunity for Growth” to foster self-employment and drive grassroots economic development across the country, according to circulars issued by the central bank’s SME and Special Programmes Department reported by The Business Standard.
Udyog Financing Structure and Blended Package
This funding splits equally between a bank loan of up to Tk 10 lakh and a matching grant of up to Tk 10 lakh. For example, a business requiring a total of Tk 12 lakh receives Tk 6 lakh as a bank loan and Tk 6 lakh as a grant. Bangladesh Bank directs that both the grant and loan portions disburse simultaneously into the recipient’s bank account. However, failure to repay the loan or misuse of funds automatically converts the grant portion into an interest-free debt recoverable under standard recovery laws.
Eligibility Criteria and Collateral Rules
Applicants must be adult Bangladeshi citizens aged up to 28 years on the final application submission date and must be permanent residents of their respective upazila. Candidates must maintain a clean credit history with no loan defaults, as verified by Credit Information Bureau checks. Furthermore, individuals who have previously taken business loans from any financial institution or who work as public, semi-government, and autonomous institution employees cannot apply. To minimize barriers for young founders, participating banks disburse loans under the programme without requiring collateral.
Eligible Ventures and Application Workflow
The policy covers a wide range of legal business models, prioritizing both innovative ideas and existing ventures in sectors such as tech startups, agriculture, food processing, light engineering, renewable energy, and handicrafts. Bangladesh Bank will nominate one lead bank for each upazila to execute and coordinate operations. Any scheduled bank branch collects application forms and forwards them on the next working day to the respective upazila lead bank, which then routes them to the district lead bank and central bank departmental offices. A multi-stakeholder panel comprising central bank officials, scheduled bank representatives, successful entrepreneurs, industry leaders, and academics evaluates business plans, market feasibility, and employment potential before final selection. Designated banks must sanction loans within 15 working days of final selection, adhering to internal credit rules and central bank regulations, while also providing financial literacy training, mentoring, market-linkage support, and registration assistance.