The State Bank of Pakistan (SBP), Pakistan’s central banking authority, recently announced a new regulation allowing microfinance banks (MFBs) to lend up to PKR 500,000 (USD 5,439) to microenterprises. Previously, MFBs were allowed to disburse general purpose loans of up to PKR 150,000 (USD 1,631). This amendment to Pakistani Prudential Regulations 10 and 11 is intended to address the unmet credit needs of the microenterprise market [1].
The term “microenterprise” is used by SBP to refer to “projects or businesses in trading, manufacturing, services or agriculture sectors that lead to livelihood improvement and income generation, undertaken by micro-entrepeneurs who are self-employed or have less than 10 employees.”
By Amira Berrada, Research Associate
About State Bank of Pakistan (SBP): Established in 1956, the State Bank of Pakistan (SBP) is the nation’s central banking authority. SBP is responsible for the following primary functions: to regulate and supervise the nation’s financial system, to carry out monetary policy and to manage public debt. In addition, SBP performs the following non-traditional functions: developing the financial framework of the country, providing credit to priority sectors and furthering the Islamization of the banking system.
Sources and Resources:
[1] http://www.sbp.org.pk/publications/prudential/micro_prs.pdf
MicroCapital.org article, January 2, 2012, “MICROCAPITAL BRIEF: State Bank of Pakistan Releases Five-Year ‘Microfinance Strategic Framework,’ Launches Financial Literacy Programme” https://www.microcapital.org/microcapital-brief-state-bank-of-pakistan-re…
MicroCapital.org article, October 3, 2011, “MICROCAPITAL BRIEF: State Bank of Pakistan (SBP) Reduces Provision Requirements for Microfinance Loans” https://www.microcapital.org/microcapital-brief-state-bank-of-pakistan-sb…
MicroCapital Universe Profile for State Bank of Pakistan: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Sta…
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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