State Bank of Pakistan (SBP) is providing cheap financing facilities with minimum mark up-rate to five important segments for the speedy, balanced and systematic industrial, economic and commercial growth in the country, said Waqas Kashif Bajwa Chief Manager SBP Faisalabad. Addressing an awareness session on Export Refinance Scheme on Wednesday, he said that economic growth is tagged with multiple factors. However the provision of finance is the sole responsibilities of SBP.
Pointing out the five major sectors, he told that these include SME, women entrepreneurs, promotion of renewable energy resources, Islamic banking and up-gradation of industrial units. He briefed about the salient features of these schemes and told that among these include short and long-term measures.
Regarding export refinancing scheme, he told that this is the oldest scheme introduced in 1973. Under this scheme working capital is provided for 180 days at a mark-up rate of only 3 percent. Similarly, the foreign proceeds are to be repatriated within another 180 days. He said that 99 percent exporters are availing from this facility as its negative list is very negligible. The ultimate objective of this negative list is to protect the domestic value-added sector.
Regarding loans for renewable energy, he told that under this scheme loans could be procured for a period of 10-12 years with a fixed mark-up rate of 6 percent. He said that people should avail from this scheme by setting up their own units to meet their domestic, commercial or industrial needs.
Commenting on the problem confronted by the SME sector in getting fresh loans, Chief Manager told that SBP has declared it mandatory for all commercial banks to allocate at least 10 percent of their total loan portfolio for the SME sector. He further told that earlier there was no clear demarcation between small and medium units which has now been clarified explicitly.
Regarding long-term finance, he told that under this scheme subsidized loans up to Rs 1.5 billion could be applied which could be provided for a period of 10 years at a mark-up rate of 6 percent. "It could be used for up gradation, balancing and modernization of existing industrial units," he added. Regarding loans allocated for the women entrepreneurs, the Chief Manager SBP said that bank provide this loan at zero mark-up in addition to sharing 60 percent of the loss if incurred.
The concerned scheduled bank will provide this loan at only 5 percent mark-up as the objective of this scheme is to encourage the female entrepreneurs to start their own businesses. He further told that Islamic Banking is yet another sector which is growing at a much faster pace. "We are encouraging it to cater to the needs of the people who are inclined towards Islamic banking, he added. As it is comparatively new sector compared to the conventional banking, it was introducing new products which are fully compliant to the Islamic Sharia. He said that earlier in some cases only nomenclature of the banking was changed but now we are expecting really Islamic banking products in near future.
He also discussed the issue of KIBOR and said that SBP as well as other banks are also trying to resolve this issue without any unnecessary delay. Earlier, in his address of welcome Shabbir Hussain Chawla, President FCCI thanked SBP for organizing this awareness session on refinance schemes launched by SBP.