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SME Featured South Asia

State Bank of Pakistan launches challenge fund for local SMEs

Islamabad, Pakistan – The State Bank of Pakistan (SBP) has announced the launch of a challenge fund for local small-and-medium enterprises (SMEs). According to their latest circular, SBP instructs local banks to develop innovative technological solutions to cater the banking needs of the SME sector. In addition, this will also enable the SME sector to increase the access and usage of digital financial services.

Said challenge fund will be focusing on developing SME banking solutions, digital payment solutions for SMEs, developing e-commerce or online marketplace, and digitising loans application and credit management.

The grant size will be determined according to the financing requirements of the proposal under consideration. However, each grantee will contribute 15% of the total cost. Depending upon the quality and innovations of the proposal, the grant size can vary, however one bank will get only one grant. 

The duration of the projects to be implemented through CFS grant should not exceed 8 months.

In addition, commercial banks–both conventional and Islamic, are eligible to apply for grants under the fund. Banks can also apply in partnership with non-banking financial Institutions (NBFIs), fintechs, electronic money institutions (EMI) and software houses. However, lead responsibility will rest with the applicant bank.

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SME Featured South Asia

State Bank of Pakistan, Multan Chamber host 2-day SME event

Multan, Pakistan – The State Bank of Pakistan (SBP) and the Multan Chamber of Commerce & Industry (MCCI) had recently hosted a 2-day SME mela or event on January 25 to 26, where attendees visited the banks’ stalls to seek knowledge of SBP’s financing schemes and banks’ loan products.

The event was attended by officials and members of chambers of industry and commerce, associations of traders and women entrepreneurs, and SMEs clusters of Multan. Said attendees registered themselves at various bank’s stalls to express interest in concessional schemes, including 105 SMEs and women entrepreneurs who applied on the spot for financing under different SBP’s schemes and the Kamyab Jawan Program, a youth development program by the Pakistani government.

Muhammad Ashraf Khan, managing director at SBP Banking Services Corporation (SBP BSC), inaugurated the event and while giving his keynote address said that SBP is making all its efforts to enhance collaboration with the industry and chambers across the country to spread awareness of its credit schemes to boost their utilisation. 

He also added that through the event, banks and the business community would be brought under one roof, providing an opportunity to micro, small, and medium enterprises to seek guidance from concerned officials of SBP and commercial banks about concessionary refinance schemes. He also encouraged those SMEs to apply under SBP’s SAAF that have strong business viability but do not have collateral to offer. 

On day one of the Mela, participants were briefed about the key features of SME ASAAN Finance Scheme (SAAF) and PM Kamyab Jawan Youth Entrepreneurship Scheme. Under SAAF Scheme, collateral free financing of up to Rs10m is available through eight participating banks. Similarly, under Kamyab Jawan Scheme, concessional loans of up to Rs25m are available at end user rate of 3% to 5%. On the second day of Mela, participants were apprised about key features of SBP’s financing scheme for renewable energy and Mera Pakistan Mera Ghar (MPMG) Scheme.