January 30, 2019 (MLN): Karandaaz Pakistan, a company funded by the UK’s Department for International Development (DFID), and JS Bank, one of Pakistan’s fastest growing banking institutions, signed the risk participation agreement to jointly facilitate SME financing.
The facility has been designed on a 50-50 risk participation basis between the two organizations to improve overall commercial lending for the SME sector in Pakistan.
Joanna Reid, Head of DFID Pakistan, while speaking about the partnership between Karandaaz and JS Bank said, “I’m proud of the agreement signed today as SME financing means more jobs for younger people, a skilled workforce and innovation in businesses. The UK is committed to support Pakistan to reduce poverty and achieve prosperity for all.”
Speaking at the occasion Mr. Ali Sarfraz, CEO Karandaaz Pakistan said, “It is critical for broad based economic and employment growth in Pakistan that the existing credit contraction is reversed and brought in line with comparable international benchmarks of at least 20-30 percent of banking assets directed towards SME financing.”
Adding on, he opined that it is crucial for commercial banks to develop viable credit models to lend to this vital agent of the economy.
JS Bank, has embarked on several initiatives to strengthen its product lineup including variants of value-added financial services and technology based solutions to expand its SME relationships.
In addition to introducing specific products and services for SME financing, the bank has further enhanced its focus through its relationship lending model as well as operating through several dedicated hub branches across the country.
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