Asma Marzouq – Palestine Economy Portal

Translated by Tamara Barakat

The CEO of the Palestinian Fund for Employment, Dr. Ziad Karablieh, called on those interested to borrow loans through the “Start-Up Palestine” project that is funded by an Italian grant, to do so through the five small lending institutions participating in the program, including Faten, Asala, Ibdaa’, Vitas, and ACAD Finance.

The Fund announced a few days ago the launch of the project and the transfer of 7 million euros, as the first installment of the Italian grant, to be followed by a second installment of 7 million euros after the lending institutions give loans that amount to 80% of the first installment.

The Fund’s working mechanism is based on circulating the money through lending them as loans through lending institutions in order to ensure that people continue to benefit from the funds and that new job opportunities are created.

Moreover, Karablieh affirmed that although there is no specific or unified interest rate that is agreed on among the lending institutions, the signed agreement stipulates that interest rates paid by the beneficiaries of this program must be lower than those placed on loans normally given by the institutions for their other projects.

The interest rates on loans given by small lending institutions are normally higher than those on loans given by banks. They range between 10-24%, which is a high percentage that lending institutions explain results from the high cost of the loans on them.  

During the project launching ceremony, the Minister of Labor, Mamoun Abu Shahla, asked all of the lending institutions partaking in the project to decrease the interest rate on the loans they will give to the beneficiaries as much as possible, in order to increase the benefit of the project’s targeted groups and encourage them to make investments, in addition to creating sustainable self-employment job opportunities.  

Karablieh said that the anticipated number of the beneficiaries might reach 3500 people, and the sizes of the loans will range between $500 to $35 thousand, depending on the laws of each institution.

He added that the Fund will make sure to follow up with the beneficiaries to help them develop and expand their businesses.

The Fund will launch a promotion campaign for the project, which will include Palestinian universities and entrepreneurship institutions among others. It will also promote the project through newspapers and on social media.

The agreement entered into with the lending institutions includes supporting the services, commerce, agriculture, light manufacturing, and IT sectors. It also prioritizes supporting the projects of women and youth.