Pakistan is preparing a major shift in the way businesses access bank financing, with Prime Minister Shehbaz Sharif unveiling ambitious targets to sharply increase lending to small and medium sized enterprises (SMEs), a move the government believes could boost exports, create jobs and fuel the country’s next phase of economic growth.
Chairing a high level meeting on Friday, the prime minister reviewed Pakistan’s new Access to Finance Plan and made it clear that banks would have to play a much bigger role in supporting productive sectors instead of limiting credit to a narrow segment of borrowers.
Calling SMEs the backbone of Pakistan’s economy, Shehbaz said easier and more affordable access to finance was vital for businesses looking to expand, invest and hire more workers. He added that stronger lending to the sector would help the country increase exports while supporting sustainable economic growth.
The meeting was told that the government wants to more than double the number of businesses receiving SME loans over the next two years. The target is to increase beneficiaries from about 310,000 to 750,000.
At the same time, the share of SME financing in total private sector bank credit is expected to rise from the current seven per cent to 10 per cent, marking one of the government’s most ambitious efforts in recent years to widen access to business financing.
Officials said the Access to Finance Plan is not limited to bank lending alone. It also seeks to bring more people and businesses into the formal financial system, helping them gain access to financial services that can support investment, business expansion and long term economic participation.
To ensure the plan stays on track, the government is introducing a new oversight structure led by the federal finance minister, with the State Bank of Pakistan governor serving as co-chair. The framework will bring together the finance ministry, the central bank, provincial governments and other institutions responsible for implementation.
Shehbaz directed that progress be reviewed regularly and announced that he would personally chair monthly meetings to monitor the plan’s implementation, signalling that expanding access to finance will remain a key government priority.
In a separate development, the prime minister met two candidates for the post of United Nations secretary general, Macky Sall and Rebeca Grynspan. During the meetings, he reaffirmed Pakistan’s support for the United Nations and called for stronger implementation of international law and UN Security Council resolutions, while stressing the organisation’s role in advancing peace, security, development and human rights worldwide.
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