KARACHI, Feb 23: President of National Bank of Pakistan Ali Reza said on Friday that 1,100 unemployed persons had been offered assistance under the NBP Karobar scheme so far since its launch in October 2006. The bank has plans to expand this number to 1.8 million jobless people in next five years with a total loan amount of Rs105 billion.

The NBP president announced an extensive launching of the scheme from March 31 onwards through 1,000 branch network in the country. In his first presentation to the media on Friday at the NBP conference room, Mr Ali Reza elaborated on various aspects of the NBP Karobar that was launched as Rozgar scheme by the government.

Under NBP Karobar, five different financial packages are being offered to the unemployed persons between 18 and 45 years of age. These are: (1) Utility Store under a franchise, (2) a mobile general store, (3) transport, (4) PCO and (5) a tele-centre

“This is not a political gimmick,” the NBP president took pains to dispel this impression and stressed that the NBP Karobar is a unique product that has been launched as a viable public private partnership commercial proposition after tremendous research and study of similar schemes in India, Indonesia, Bangladesh and Thailand.

He made it clear that the NBP Karobar was not a consumer financing product. The consumer financing does not generate income or economic benefits to the beneficiary of the loan but it creates some comfort.

But the NBP Karobar in its present five categories will generate income and economic benefit and after the full loan is paid in two to five years, the beneficiary of the loan will become owner of the asset, he added.

His assessment was that the beneficiary of this loan will be able to earn income between Rs10,000 to Rs18,000 a month after he has paid all instalments and becomes owner of the facility.

Mr. Reza spoke at length to point out that the government’s Rozgar scheme announced by the minister of state for finance in his budget speech in June and later launched by the NBP as Karobar scheme has nothing to do with the employment schemes like yellow cab or similar other projects.

“The applicant will contribute about 30 to 40 per cent of the cost of product to be offered to him under the scheme while the NBP will offer 60 per cent,” he said adding that the government’s contribution in the scheme is six per cent interest subsidy, loss sharing, free life and disability insurance and registration for the recovery of assets of NBP throughout Pakistan.

Mr Reza did concede that the progress on Karobar scheme was slow because like all retail products, “we are passing through a learning phase and trying to understand problems.” His other explanation for slow progress was that it was launched in October when it was Ramazan. The progress remained slow in November and December but picked up tempo in January and reports suggest further improvement in February.

He justified association of two companies with the scheme for offering the product because he said the idea was to ensure availability of products, uninterrupted supply of spare parts and after-sales-service. But with the course of time he said more products will be offered in the scheme and its scope will be enlarged.

“This scheme is not structured exclusively for the NBP, he declared adding that it was open for all the banks to participate.

Earlier Mr Aamir Siddiqui of the bank announced relaxation of certain requirements, which include age, driving licence, education, character certificate, guarantor and reduction in down payment to 10 per cent from 15 per cent.