Snap Shot of Access to Finance
Development finance (DF) sector is serving 2.6 million borrowers with an outstanding portfolio of Rs. 606 Billion. Male borrowers dominate with a significant share of 87% in the total borrower base. Overall, highest number of borrowers (1.4 million or 54%) are concentrated in agriculture sector followed by microfinance with 0.97 million borrowers (38%).Male Female total borrowers is 5%. Sectoral distribution shows that maximum number of female borrowers is in microfinance banking sector which make up 78% of the overall female borrower base within the DF sector.
Microfinance industry: Savings and savers go up
The value of savings in the microfinance industry increased 38% in 2013 with the number of savers going up 24%, according to data released by the Pakistan Microfinance Network (PMN). On a quarter-on-quarter basis, the number of active savers increased 16.1% to 5.9 million in October-December while the value of savings went up 18.7% to Rs34.7 billion in the same quarter.
Agriculture Sector to be developed: SBP official
The State Bank of Pakistan (SBP) is conducting financial literacy and awareness programmes for farmers at grassroots level to improve access to finances. Muhammad Imaduddin, senior joint director of Agricultural Credit and Microfinance Department, SBP, said that SBP’s multi-pronged strategy to increase agriculture credit outreach includes mainstreaming of agriculture finance, removing policy and regulatory impediments, capacity-building of commercial banks and information dissemination and awareness building campaigns for farmers
Historically, a major reason for low access to financial services in Pakistan has been the cost and time spent by low income people to reach out to distantly located bank branches for carrying out their small value transactions. Currently, eight branchless banking providers have developed a network of 125,000 agents to provide services including bills payment, fund transfer, G2Ps, loan repayments and others. These agents have performed a total of almost 192 million transactions worth Rs. 802 billion during the 2013.
Youth loans may be given as per NFC formula
The Nawaz Sharif government is devising a formula to distribute loans under the Youth Business Loans Scheme on the basis of population and backwardness of the federating units, it is learnt. Exactly on the pattern of National Finance Commission (NFC) Award formula, the government is working on different options to finalize share of each province in this scheme of Rs100 billion a year or Rs500 billion in five years. “On the basis of equity and fair distribution of loans all across the country, different options for finalising this formula are under consideration which will be firmed up in a few days.