SBP committed to making banking services easy to access

KARACHI: The State Bank of Pakistan (SBP) is committed to using all the possible means to make the banking services accessible to all segments of the society.

Managing Director, SBP Banking Services Corporation, Qasim Nawaz at the two-day banking exhibition at Gujranwala on Friday highlighted various initiatives taken or being taken by the SBP to facilitate the underserved sectors of the economy in the field of agriculture, SME and microfinance.

The ongoing review of policy and regulatory environment is to promote SME, agriculture and micro finance as a viable and mainstream business activity for banking industry.

SBP is also undertaking review of the existing Prudential Regulations for SME Financing, to develop and separate PRs for “Small Enterprises” & “Medium Enterprises. When implemented, this exercise would facilitate small enterprises’ access to bank credit and consequently raise their share in banks’ loans).

Introduction of Credit Guarantee Scheme for Small & Rural Enterprises (CGS) to share credit risk with banks (upto 40%) with the objective of increasing banks’ lending in neglected sectors/areas. Around 2,000 accounts have been issued guarantee under CGS. An amount of Rs 925 million has been disbursed to small and rural enterprises under CGS and SBP shares risk worth Rs 392.5 million with commercial banks for their lending to this sector.

Introduction of Microfinance Credit Guarantee Facility for resolving liquidity problems for microfinance banks/microfinance institutions. Ten MFBs/MFIs have been provided funding facilities worth Rs 2.8 billion under the scheme by banks.

SBP BSC has provided guarantee cover of Rs 805 million for the lending by commercial banks to MFB/MFIs.

Whereas introduction of refinance scheme for modernisation of SMEs, introduction of refinance scheme for agriculture produce storage construction, crash training programme for the SME and agriculture credit officers of banks. Special capacity building programmes for MFBs/MFIs and Islamic banks are also in the pipeline, launch of eCIB for MFIs to assess the credit worthiness and to avoid over-indebtedness of small borrowers, establishment of SME, agri and microfinance focus groups at BSC field offices across the country to strengthen the consultative mechanism in policy formulation and implementation, initiation of surveys and studies of different regions (furniture industry and rice husking industry surveys of Gujranwala region are planned this year), development of linkages with all the key stakeholders both at country level as well as the district/region level to adopt a collaborative strategy to help/facilitate the entrepreneurs and rural communities in accessing financial services from banks, organising SME, micro, agri and Islamic seminars, workshops, exhibitions and fairs in cities and rural areas in collaboration with banks, SMEDA, and provincial agricultural, livestock departments to create awareness amongst the stakeholders at grassroots level about financial services.

These studies will enable banks and SBP to make their policies, initiatives and products more responsive to the market needs.

Qasim Nawaz expressed hope that the banking exhibition at Gujranwala would go a long way in improving access to finance for the lower segment of the borrowers of the region.