SBP calls for deep reforms to drive inclusive, sustainable growth

December 23, 2025 (MLN): The State Bank of Pakistan (SBP) has emphasized the need for deep-rooted reforms to ensure sustainable economic growth and break the country’s recurring "boom-bust" cycles.

The 25th Zahid Husain Memorial Lecture in Karachi featured a keynote address by renowned economist Professor Amir Sufi, Bruce Lindsay Distinguished Service Professor at the University of Chicago and 2017 Fischer Black Prize recipient and remarks by Deputy Governor SBP Saleemullah.

Deputy Governor SBP Saleemullah lauded Pakistan’s improving macroeconomic stability while stressing the central bank’s proactive role in supporting technology-driven and inclusive growth, said a press release issued.

He further highlighted that channeling adequate capital toward the real economy, which can expand financial access for SMEs, youth, and women, and shifting from traditional collateral-based lending toward cash flow-based financing are critical steps for fostering inclusive and resilient growth.

On the parallel, Professor Sufi discussed how global economies are increasingly shifting toward high-tech and professional services sectors that rely heavily on intangible assets such as research, innovation, and specialized knowledge.

He noted that traditional banking models, which depend on physical collateral, are often ill-suited to finance such firms, while highlighting the need for cash flow-based lending and greater use of venture capital and private equity to support innovation-driven growth.

Deputy Governor Saleemullah also touched on SBP’s ongoing initiatives, including risk coverage facilities for SME and agriculture finance, the Banking on Equality policy, and the Regulatory Sandbox for fintech.

Supported by digital infrastructure such as e-KYC and faster payment systems, these measures aim to create a robust framework for technology-led economic expansion.

The event concluded with an interactive fireside chat, during which Professor Sufi elaborated on policy priorities for Pakistan and responded to questions from the audience, while reinforcing the importance of regulatory coordination and institutional reforms to enable high-growth sectors.

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