SBP Celebrates MSME Day, Emphasizes Role in Economic Growth
The State Bank of Pakistan (SBP) joined the global community in celebrating Micro, Small, and Medium Enterprises (MSME) Day, emphasizing the crucial role these enterprises play in driving economic growth, fostering innovation, and creating jobs. This year’s theme, “MSME Finance: Catalyst for Inclusive Growth,” underscores the importance of financial support in unlocking the potential of SMEs.
SBP organized a seminar to mark the occasion, attended by Presidents and CEOs of banks and Development Finance Institutions (DFIs), senior SBP management, government officials, and representatives of trade bodies.
In his keynote address, Deputy Governor Saleemullah highlighted that SMEs are the lifeline of Pakistan’s economy, providing employment to 80 percent of the non-agricultural workforce, contributing 40 percent to GDP, and accounting for over 25 percent of total export earnings. He emphasized SBP’s focus on creating an enabling environment for SME finance to grow, allowing these enterprises to thrive and contribute to sustainable economic growth.
As part of its Vision 2028, SBP aims to double SME financing to Rs. 1,100 billion over the next five years, with Rs. 100 billion to be added to the SMEs’ outstanding portfolio by the end of June 2025. The Deputy Governor called on all banks to play their part in promoting SME finance and surpass the Rs. 100 billion estimated increase for FY 2024-25.
To further support SME finance, SBP has proposed that the government provide risk coverage to banks on their fresh financing to SMEs. Under this proposal, banks would receive 20 percent first loss coverage on fresh exposures to Small Enterprises (SEs) and 10 percent coverage for Medium Enterprises (MEs). The necessary allocations for FY25 have been included in the budget.
In his concluding remarks, the Deputy Governor urged all stakeholders to renew their commitment to creating a supportive environment where small and medium-sized enterprises can flourish, thereby driving economic growth and innovation across the nation.
An event was also held at the Banking Hall of SBP to raise awareness about the significant contributions of MSMEs to Pakistan’s economy. Throughout the day, commercial banks and SMEs showcased their products, drawing keen interest and praise from visitors for this collaborative initiative of the banking industry and SMEs.
