SBP approves over Rs237bn loans under Rozgar Scheme

The State Bank of Pakistan has to date approved financing of Rs237.21 billion under its Rozgar Scheme, covering 2,949 businesses and 1,672,036 employees.

As per SBP, under its refinancing scheme for protecting businesses from the COVID-19 impact it has so far deferred Rs655.27bn principal repayments of loans up to one year, after approving 1,476,938 requests.

Under relief provided to the borrowers, SBP has also allowed around Rs199.9bn for restructuring/ rescheduling.

Furthermore, under Refinance Scheme for Hospitals to Combat COVID-19, SBP has approved financing of Rs7.992bn for 41 hospitals whereas, it has received requests from many as 48 hospitals for the financing amounting of Rs11.77bn.

To counter the negative impact of Covid-19 on the economy SBP introduced a Refinance Scheme to Support Employment and Prevent Layoff of Workers, commonly known as SBP Rozgar Scheme, in April 2020.

The scheme provides concessional financing to businesses for wages and salary expenses, provided they commit to not lay off their employees for the period of the loan. The Scheme was later complemented by a Risk Sharing Facility (RSF) of the Government of Pakistan (GoP) for SMEs and Small Corporates with turnover of up to Rs2 billion.

Under this facility, GoP bears up to 60% first loss on the principal amount portion of disbursed portfolio for SME borrowers whereas 40% risk coverage is available for Small Corporates. The objective of this facility is to incentivize banks to extend loans to SMEs and Small Corporates, to whom they may not cater to for risk considerations.

The Scheme was available till end June 2020 earlier, however, SBP decided to extend the validity of this scheme by another 3 months to end September, 2020.