SME financing rises to Rs882bn, Rs221bn disbursed under PM youth loan scheme

The banking sector’s total outstanding financing to small and medium enterprises (SMEs) reached Rs882 billion by December 31, 2025, marking a 36% year-on-year increase, while Rs221 billion has been disbursed under the Prime Minister’s Youth Business and Agriculture Loan Scheme.

As per reports, the figures were shared during the 15th meeting of the National Coordination Committee on SME Development, chaired by the Special Assistant to the Prime Minister on Industries and Production, Haroon Akhtar Khan. The meeting was attended by officials from the Ministry of Industries and Production, the Small and Medium Enterprises Development Authority (Smeda), provincial representatives and banking sector officials.

According to the data presented, around 302,922 SMEs were facilitated through overall bank financing, reflecting a 65% year-on-year growth in outreach.

Under the SAAF Scheme, Rs60 billion in clean lending was extended to 12,500 SMEs. Separately, Rs221 billion was disbursed through the Prime Minister’s Youth Business and Agriculture Loan Scheme, benefiting 461,795 businesses and individuals.

The committee also discussed revising the definition of SMEs by raising annual sales turnover thresholds. It was proposed that micro enterprises be defined as businesses with annual sales up to Rs30 million, small enterprises from over Rs30 million to Rs400 million and medium enterprises from over Rs400 million to Rs2,000 million.

The meeting emphasised the implementation of the National SME Policy 2021 and directed Smeda and provincial authorities to ensure regular follow-up and reporting on progress.

Officials stated that improving access to finance remains central to SME growth, adding that banks are facilitating credit access across regions, including Gilgit-Baltistan, Azad Jammu & Kashmir and Balochistan. The committee also reviewed initiatives related to skill development and artificial intelligence training aimed at enhancing SME competitiveness.