A-PM-FR Shaikh launches the STR
By Staff ReporterFriday – May 8, 2020
According to an official statement, the STR, established under the financial institutions (secured transactions) act, 2016, for registration of security interests/charges created by entities other than companies on their movable assets, has been operationalised by the securities and exchange commission of Pakistan (SECP).
Financial institutions can now file security interests online.
Registration process is fully automated and the registry is searchable by general public, free of charge.
In her address at the occasion, department for international development (DFID) Pakistan, the head of department, Annabel Gerry, lauded the efforts of the financial sector regulators for their thought leadership and progressive role.
Karandaaz Pakistan chairperson, Shamshad Akhtar, also praised the SECP leadership and assured of Karandaaz Pakistan’s continued support for the SECP’s technology projects.
State Bank of Pakistan (SBP) governor Reza Baqir and SECP chairman Aamir Khan also spoke on the occasion.
Speaking at the occasion, A-PM-FR Shaikh appreciated the support offered by the British government, through DFID and Karandaaz, and collaboration between SECP, SBP, board of investment (BoI) and the world bank (WB) for the successful implementation of this reform.
He particularly lauded the commitment demonstrated by the SBP and SECP teams, and the hard work of the SECP for spearheading this initiative, and its completion within a year of its assignment to the SECP in March last year.
A-PM-FR Shaikh, while discussing the importance of this initiative, highlighted that micro, small and medium enterprises (MSMEs) play a vital role in the economic development of the country due to their significant contribution in terms of output, exports and employment.
Particularly, small and medium enterprises (SMEs) constitute approximately 90 percent of businesses in Pakistan, employ 80 percent of the non-agricultural labour force and contribute 40 percent in country’s annual gross domestic product (GDP).
He noted that despite playing a significant role in economic growth of the country, SMEs access to formal finance is limited to only 6 percent of the total financing by the banking sector.
A-PM-FR Shaikh was optimistic that this initiative will prove to be a game changer by improving the access to finance for the MSMEs, agri borrowers and rural enterprises.
The commencement of the registry will broaden the scope of assets that these underserved segments can offer as a security for availing the finance.
On the other hand, this reform will also help banks to expand their lending portfolios.
The operationalisation of STR will contribute towards improving Pakistan’s score on “getting credit indicator,” and in particular raise its global ranking on the WB’s doing business’ index.
The launch of STR is yet another millstone achieved by the incumbent government that is a testament to its commitment towards improving financial inclusion, growth of the private sector and ultimately, the economic development of the country.
The launching ceremony was chaired by A-PM-FR Shaikh and attended by SBP governor Baqir, SECP chairman Khan, BoI chairman Atif R. Bokhari, Karandaaz Pakistan chairperson Akhtar, Karandaaz Pakistan chief executive officer (CEO) Ali Sarfraz, DFID Pakistan, the head of department, Gerry, WB country director Illango Patchamuthu, SECP commissioners Shaukat Hussain and Shauzab Ali.