The State Bank of Pakistan (SBP) has introduced a new initiative, SME Connect, to simplify the process of obtaining loans for small and medium-sized enterprises (SMEs) across the country.
According to the central bank, the new platform has been launched to make loan applications easier and improve access to SME financing. The initiative is expected to enhance efficiency, transparency and accessibility, enabling small and medium-sized businesses to obtain financing more conveniently.
Under the new system, all applications for SME loans will be received exclusively through SME Connect starting November 1. The initiative aims to expand access to credit for businesses across Pakistan and streamline the loan application process.
Meanwhile, according to media reports, the reporting threshold for cash transactions at banks has also been increased. Banks will now be required to report daily cash transactions exceeding Rs3 million to the Financial Monitoring Unit (FMU), compared with the previous threshold of Rs2 million.
Sources said further changes are being considered in the financial monitoring system to prevent money laundering. As part of these measures, an agreement has also been reached to grant powers to provincial anti-corruption agencies.
Earlier, SBP raised its policy interest rate by 50 basis points, from 11.5% to 12%, citing rising inflationary pressures. Announcing the monetary policy decision, SBP Governor Jameel Ahmad said nine of the 10 members of the Monetary Policy Committee (MPC) approved the increase. The governor noted that rising oil prices had contributed to inflationary pressures, prompting the central bank to raise the policy rate by 0.5 percentage points.
Governor Jameel Ahmed said multiple underlying factors, particularly the inflation outlook, prompted the central bank to raise its policy interest rate by 50 basis points to 12%. Addressing a press conference following the monetary policy announcement, Ahmed cited the US-Israel war on Iran and its impact on global energy and oil prices, developments in the domestic market, and their subsequent effects on inflation.
He said nine of the 10 members of the Monetary Policy Committee (MPC) voted in favour of the rate increase, while one member held a different view and believed the policy rate should be raised further. The governor said the committee had also considered consumer expectations, forecasts by other economic observers, and broader macroeconomic factors. These included the impact of global commodity and oil prices on the external account, as well as trends in remittances and exports.
Ahmed acknowledged that the current account position had deteriorated since the previous MPC meeting. However, he said the impact remained limited, amounting to between zero and one per cent of gross domestic product (GDP), and was expected to remain within that range.
The SBP governor also revised the central bank’s remittance forecast upward from $44 billion to $45 billion. He said export trends were improving but remained below the level required to meet the economy’s needs. Meanwhile, the bank estimated imports at around $71 billion.
