Merged districts: KP govt launches interest-free loan scheme
PESHAWAR: The Khyber Pakhtunkhwa government has launched a interest-free microfinance scheme for entrepreneurs to support small businesses and enhance livelihoods in the merged districts.
The initiative, which spans 13 years (2021–2034), has already made substantial progress, with 66,557 individuals benefiting from the programme so far, while 22,152 more are currently receiving financial support under the scheme, according to a statement issued here on Wednesday.
It said the programme provides interest-free loans ranging from Rs 25,000 to Rs 75,000, with a flexible repayment period of up to 36 months.
This structure has been designed to ensure that recipients can repay the loan in easy installments without the burden of interest, making it especially accessible for low-income and underserved populations, the statement added.
It furthermore elaborated the project is being implemented by the Khyber Pakhtunkhwa Small Industries Development Board (SIDB), with a total allocation of Rs 2.007 billion.
Operational execution is being carried out in partnership with Akhuwat Foundation Pakistan, one of the country's most trusted microfinance institutions, it added.
Currently, 36 branches of Akhuwat are functioning in various merged districts, enabling local residents to apply for loans close to home, according to the statement. It added the scheme caters to a wide range of economic sectors. Beneficiaries have used the funds to start new businesses, expand existing enterprises, purchase necessary equipment and machinery, and invest in agriculture and livestock development.
This multi-sectoral approach ensured that people from all walks of life, particularly those from rural and economically marginalized backgrounds, can benefit from financial inclusion, it concluded.
Copyright Business Recorder, 2025
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