BoB to provide collateral free loan to DeSuups, who have completed the Dessung Skilling Programme
For more than 2,000 DeSuups, who have been trained and skilled through the Desuung Skilling Programme (DSP) so far, the Bank of Bhutan Limited (BoB) launched the DSP start-up loan on May 11.
The DSP start-up loan has been approved and classified under the Priority Sector Lending Portfolio (PSL), where skilled DeSuups can get loans of up to Nu 5mn from the bank without mortgage or collateral.
Elaborating on the DSP start-up loan, the Chief Executive Officer of BoB, Dorji Kadin said, “The main objective of this loan is aimed at the DSP graduates who aspire to be independent and sustain on their own.”
He added that the two major features of the loan are that it is collateral free and it is also offered at the lowest interest rate of 8%.
Further, the DSP start-up loan is a cash flow based loan where no collateral is required. Instead of collateral, a guarantee by another eligible DeSuup applying for the start-up loan will be required.
Launched on May 11, BoB describes the scheme as the first-of-its-kind financing for aspiring DeSuups who wish to venture into several fields of business.
According to the BoB’s press release, access to finance because of collateral requirements has been one of the biggest impediments to setting up businesses and this DSP start-up loan, which doesn’t require collateral, will enable any eligible and interested DeSuup to start a business.
Meanwhile, the loan ceiling for an individual DeSuup is Nu 0.5mn, for partners it is Nu 1mn per partners, and for cooperatives it is Nu 5mn.
The loan tenure will be for 20 years, while it will be for five years for gadgets loans.
“The program also aims to assist young aspiring entrepreneurs in pursuing business opportunities as well as to solve unemployment and boost the economy,” BoB’s CEO said.
Besides the fact that the loan is specifically for DeSuups, who want to venture into businesses, there are also a few requirements that need to be met in order to be eligible for the loan, such as a Desuup needing to have successfully completed the DSP and the DeSuup Financial Literacy Training Program. A Desuup should also have a clean credit record and a letter of recommendation from the Desuung Office.
The Chairman of BoB, Karma Yonten said that it is with great honor that BoB launched the DSP start-up loan to support the skilled DeSuups, who have been trained under the visionary DSP that has been initiated on Royal Command of His Majesty The King and as a mark of deep appreciation for the exceptional services rendered by DeSuups during the pandemic.”
He added that he is optimistic that the DeSuups would do well in business and that BoB looked forward to a successful long term partnership with the DeSuups.
As of now, close to 2,000 DeSuups have completed the DSP.
Tshering Pelden from Thimphu