SBP says SMEs can take loans without collateral

By Staff Reporter
Friday – March 19, 2021
ISLAMABAD: The State Bank of Pakistan (SBP) governor (SBP-G) Raza Baqir said, Thursday, that for the first time small and medium enterprises (SMEs) are being provided loans for business by banks without collateral.

According to a press release, the prime minister (PM) Imran Khan chaired a review meeting, in the federal capital, on the progress in the promotion of priority sectors for economic stability and development.

The PM was briefed on the progress made so far in providing facilities to SMEs.

SBP-G Baqir said that collateral free lending will help in the development of SMEs.

In this regard, for the first time an effective partnership between the government, SBP and banks is being established.

He continued that under this scheme, about 50 percent risk loss guarantee will be provided by the SBP.

SBP-G Baqir mentioned that the banks are showing great enthusiasm and interest in this regard.

He added that the focus is on building additional capacity in the designated banks, especially in terms of providing loans to SMEs.

The banks are being encouraged by the SBP to provide loans to SMEs.

The meeting was also briefed on the steps to be taken to facilitate business, especially to provide maximum facilities to foreign investors and to take steps for profitable business in the country.

The meeting was informed that the special technology zones authority (STZA) ordinance has been implemented and concessions for these zones have also been notified. In addition, customs concessions have been announced.

Land has been provided to the STZA from capital development authority (CDA) for setting up a technology zone in the federal capital. Manpower is being mobilised on a priority basis to make STZA fully operational.

Addressing the meeting, PM Khan said that the incumbent regime is committed to take all possible steps to promote growth and investment.

He continued that development of small and medium scale industries will accelerate the economic process and create wealth in the country which will not only improve the economy, provide more and better job opportunities to the youth but also make the country responsible. It will also help pay off debts.

PM Khan added that the country, which was mired in debts taken by the previous regimes, can be rescued only if the country’s production increases. In this regard, the incumbent regime is committed to provide all possible facilities to the business community and investors.

He directed that all obstacles in the way of business be removed through timeline based targets.

The meeting was attended by industry minister Muhammad Hamad Azhar, trade adviser Abdul Razzaq Dawood, special assistant Waqar Masood, board of investment (BoI) chairman Atif Bukhari, SBP-G Baqir, federal secretaries and other senior officials.