The Fund would be created in the State Bank of Pakistan (SBP) which would have the possession, management and control of the Fund, its undertakings, properties and assets, Khaleej Times reported.

The ADB has agreed to initially extend $20 million for the Fund but an equal amount of funds in a local currency would also be made available by the government as part of the counterpart funding.

The Fund would be established as an endowment fund, whereby the income generated from it would be used for supporting the activities on a grant basis, and the initial $20 million equivalent capital contribution would remain in place for the life of the fund.

The Fund would establish its own rules, subject to ADB concurrence, specifying among other things, the selection criteria for the capacity building initiatives and literacy programmes it would support, including general percentage allocations to be applied among the different categories of activities, the investment strategy for the Fund, and accounting and auditing procedures.

It is expected that the initial capital of the Fund and the unutilised income generated from the Fund would be invested by SBP in approved government securities.

The Fund would be administered and managed by a 'Governing Body' consisting of five voting members and one observer.

The Governing Body would be comprised of an SBP Nominee, CEO of Pakistan Poverty Alleviation Fund (PPAF), CEO of the Pakistan Micro finance Network, Pakistan Banking Association (PBA) Nominee, a representative from the education sector to be nominated by the other four voting members and an ADB Observer with non-voting status.