The Punjab chapter of the US – Pakistan Partnership for Access to Credit Program was recently launched in Lahore. This partnership between USAID and four banks including Khushhali Bank, Bank Alfalah, JS Bank, and The First MicroFinanceBank aims to catalyse economic growth within the SME sector through employment generation and greater financial inclusion.
“One of our top assistance priorities is helping Pakistan achieve sustained economic growth and development. Today we come together to celebrate the Punjab launch of an important programme designed to do just that,” stated US Consul General Harkenrider. He added that this partnership with Pakistani banks is part of a larger programme of support that will provide direct assistance to SMEs to help them grow, expand, and find new markets for their products and services.
At the conference, Mr Khurram Hussain, Group Head Retail North and Central, Bank Alfalah emphasised the role of SMEs in the economic and social growth of Pakistan. He said “At Bank Alfalah, it is our endeavour to enhance inclusion of the SME sector into the financial mainstream by increasing our outreach and providing complete banking solutions and financial advisory services to meet the unique needs of the unbanked masses.” Of the approximately 3.2 million businesses in Pakistan, nearly 3 million are small and medium sized.
These small and medium sized businesses produce more than 30 percent of Pakistan’s GDP and 25 percent of the nation’s total export earnings. The sector could contribute more growth but is constrained principally by a lack of access to credit. Banks in Pakistan often perceive the sector as high-risk and are reluctant to provide loans to small and medium sized businesses. To change this perception and demonstrate the financial viability of lending to this sector, USAID through the US -Pakistan Partnership for Access to Credit program has partnered with banks to provide up to $60 million in loan capital to micro, small and medium businesses.
