KARACHI: All Pakistan Business Forum has urged the commercial banks to improve its financing for small and medium enterprises (SMEs) sector which contributes around 40 percent to the national gross domestic product (GDP).
State Bank of Pakistan has launched its policy for the promotion of SME finance, but the required results were still awaited, said President APBF, Ibrahim Qureshi in a statement here on Wednesday.
He said that it was unfortunate that banks were always reluctant to provide financing to SMEs as their financing continued to show negative growth despite record reduction in policy rates by State Bank of Pakistan.
He said that a small section of public sector and Islamic banks and few DFIs were active in financing SMEs sector. Despite significantly contributing to the GDP, exports and employment generation, the financing percentage of SMEs remained pathetic in general.
He urged the government that SME policy should focus on addressing specific issues faced by the SME sector and help check reluctance of financial institutions to provide financing to SMEs.
He said that APBF fully supported the proposed measures for promotion of SME finance including the establishment of credit guarantee company for offering risk sharing facility for SMEs and setting-up of Secured Transactions Collateral Registry under Financial Institutions Secure Transactions Act 2016 by July 1, 2018.
He urged all the stakeholders to collaborate to meet the objectives of the SME policy and support the priority sectors.
Ibrahim Qureshi emphasized the importance of SMEs for the growth and development of the economy.
He called for early and speedy access to finance for SMEs, including creation of enabling regulatory framework, market development, awareness creation and capacity building programs for banks and SMEs and introduction of SME financing targets for banks and DFIs.
He stressed that a separate and comprehensive policy for the SME sector was the need of the day to promote contribution of SME sector for inclusive growth.
