How to Apply for the PSIC Interest-Free Artisan Loan of Up to Rs 500,000 in Punjab

Short answer: The Punjab Small Industries Corporation (PSIC) offers artisans a revolving interest-free loan of up to Rs 500,000, repayable in equal monthly instalments over up to 3 years. You must be 21 to 55, live in Punjab, have a clean credit record and be registered with PSIC through its geo-tagging app. A 2% processing fee is taken before the money is paid out.

Many craft workers in Punjab need money for wood, clay, thread or a small machine, and not a bank loan with markup. PSIC runs a scheme made for them. It sits on PSIC's own projects page, with the status "Ongoing" and a form to download.

We opened the PSIC website and its scheme page for artisans on 12 October 2026. This guide repeats what that page says. We did not submit an application, and we could not check how fast a regional office clears a file.

What the PSIC artisan loan offers

The scheme gives an artisan up to Rs 500,000 with no interest, to start, strengthen or expand a cottage industry business. PSIC calls it a revolving fund: repaid money goes back into the fund and is lent again to the next artisan.

PSIC states the fund size as Rs 150 million. It says about 429 artisans can be reached directly through the revolving mechanism and around 1,200 over the full scheme cycle. These are PSIC's own planning figures, not a promise that your application will be approved.

Who can apply for the artisan loan

You qualify if you are a registered artisan, a Punjab resident on your CNIC, aged 21 to 55, and your credit record is clean. PSIC rejects defaulters and anyone who delayed three instalments in a row on a past PSIC loan.

The page lists these conditions:

• You are registered with PSIC through the PSIC geo-tagging app.
• You are a resident of Punjab as shown on a valid CNIC.
• You have a clean e-CIB record. e-CIB is the State Bank credit report that shows your past loans.
• You are between 21 and 55 years old.
• You have not been a defaulter on a PSIC loan or shown a poor repayment record. PSIC defines poor as three delayed instalments in a row.

An existing PSIC borrower can apply again after repaying 75% of the earlier loan on schedule. That case depends on the satisfaction of the concerned Regional Director.

What guarantee and papers you need

You need one guarantor who is a regular government employee in BS-11 or above, plus two blank signed and undated cheques from you. The guarantor needs at least 3 years of service behind him and at least 5 years left before retirement.

One employee can guarantee only one active loan at a time. Ask a guarantor early, because this is the step that most often delays a file. Keep these with you:

• CNIC copy of the borrower and the guarantor
• The completed PSIC application form from the scheme page
• Proof of your PSIC registration from the geo-tagging app
• Service details of the guarantor, as the form asks

We did not find a full document checklist on the page, only the form. Ask the regional office to confirm the list before you travel.

How to apply step by step

Register as an artisan with PSIC, download the form from the scheme page, fill it with your guarantor, and take it to your PSIC Regional Director office. PSIC's FAQ tells craftspeople to contact the Regional Director's office of their city for loans.

1. Open psic.punjab.gov.pk and go to Projects.
2. Open "Interest Free Financial Support for Artisans of Punjab to Promote Cottage Industry".
3. Download the application form from that page.
4. Register through the PSIC geo-tagging app, so that your work is on PSIC's list.
5. Fill the form and get the signed guarantee from an eligible government employee.
6. Submit the file at the PSIC Regional Director office or Deputy Director office near you.
7. Pay the 2% fee when PSIC asks, just before disbursement.

The head office is at 23-A Davis Road, PSIC House, Lahore, and PSIC lists the number 042-992000439. Use it to find the right regional office.

What you will pay back on Rs 500,000

On a full Rs 500,000 loan, the 2% fee is Rs 10,000, and 36 equal instalments are about Rs 13,889 a month. These are our own sums from PSIC's published terms. They assume no other charge, so check the final schedule at the office.

If you need more than Rs 500,000, look at other schemes. Our guide on SME loans from banks and government schemes compares the options. A disabled applicant should read the guide on the PSIC and Akhuwat loan for disabled persons.

Reported larger scheme: check before you rely on it

Press reports said the PSIC board approved a Rs 500 million interest-free scheme for women entrepreneurs and artisans on 2 September 2026, with loans reported between Rs 500,000 and Rs 10 million. We could not confirm those larger amounts. PSIC's own scheme pages still say "up to Rs 500,000".

Until PSIC publishes the new terms, plan on the figure on its page. If a regional office quotes a higher limit, ask for it in writing. Women who run a business can also read about the SheCreates women entrepreneurship portal.

Common questions

Is the PSIC artisan loan really interest free?

Yes, PSIC describes it as an interest-free financial support scheme. You still pay a 2% processing fee before disbursement, so it is not free of all cost.

What is the maximum loan under the artisan scheme?

PSIC's page says up to Rs 500,000. A higher reported figure from the board has not appeared on the scheme page.

Can I apply without a government guarantor?

PSIC's page asks for one guarantor from a regular government employee in BS-11 or above, so you should not plan to apply without one. Ask the regional office if any other option exists.

I have an old PSIC loan. Can I apply again?

You can, if you have paid 75% of that loan as per schedule. The Regional Director must also be satisfied with your record.

What is the age limit?

The page says 21 to 55 years.

Where is the PSIC head office?

It is at 23-A Davis Road, PSIC House, Lahore. The listed contact number is 042-992000439.

How we verified this

What we checked, where we read it, and what we could not confirm.

We read the PSIC home page, its Projects page, the artisan scheme page and its FAQ page at psic.punjab.gov.pk on 12 October 2026. We did not read an application deadline, because the page shows none. The scheme terms can change, so confirm with the regional office before you pay the fee.