SBP asked to act for bolstering micro, small to medium sized enterprisesSeptember 18, 2015
KARACHI: The Union of Small and Medium Enterprises (UNISAME) at a meeting of the State Bank of Pakistan (SBP) SME Consultative Group (SMECG) held at the Learning and Resource Centre Karachi urged the SBP to take measures for high impact jump start for the micro, small to medium sized enterprises.
President UNISAME Zulfikar Thaver accompanied with the officials of the Small and Medium Enterprises Development Authority (SMEDA) Ms Nadia Jehangir Seth and Mohammad Uzair urged the executive director SBP Syed Samar Hassnain and his team of SBP officials to take much needed measures to revamping the SME Bank, expedite the functioning of Exim Bank, promote Venture Capital, increase the financing limit of Microfinance Banks and remove the cap of 40% of portfolio.
Provide better access to finance. provide export credit guarantee cover to exporters, impose upon banks to finance SMEs, widen the scope of Prime Minister Youth Loan (PMYL) to include good business plan applicants and facilitate the value addition agro based industries.
Thaver stressed the need for an SME specific bank to cater to the needs of the sector in all the provinces. Secondly the sector is awaiting the functioning of the Exim Bank to address the issues of exports and imports to and from third world countries and also export of non traditional goods to non traditional markets. Besides the Exim Bank could facilitate the collective imports of raw material from different countries and keep reserves for uninterrupted supplies of raw material.
He emphasized on the need for promotion of Venture Capital Fund to promote transfer of technology and collaboration with China particularly.
To accommodate the small sector the micro finance banks (MFBs) financing limit of Rs 500000 needs enhancement to Rs 2 millions and the cap of 40% of portfolio needs readjustment to enable the MFBs to finance the small enterprises besides micro enterprises.
The importance of export credit guarantee was highlighted and was considered very necessary to make the banks comfortable in financing the exporters.
Thaver said since agriculture is the backbone of our economy it demands the support and facilitation of the ago based industries and informed the SBP officials that the SMEs are involved in value addition and need to be supported, encouraged, facilitated and promoted.
When informed that the condition of balloting has been removed UNISAME chief said we are thankful to the PM for accepting our demand of removal of the balloting condition in the PMYL and now it is heartening to note that every single applicant on the basis of his/her good business plan would be considered on merit. He also thanked the PM for reducing the mark up rate of PMYL and widening the scope by allowing other commercial banks besides National Bank of Pakistan and First Women Bank Ltd to participate in the PMYL scheme.
UNISAME expressed gratitude to the Alfalah Bank and the Sindh Enterprises Development Fund for their guidance and support for the SME sector.