Small and medium-sized enterprises (SMEs) in Pakistan have a reason to celebrate! The Finance Ministry has launched the National Credit Guarantee Company Limited (NCGCL), the country’s first-ever credit guarantee company dedicated to supporting their growth.
Financial Lifeline for SMEs:
This revolutionary initiative aims to address the long-standing challenge of limited financial access for SMEs. Pakistan’s private credit for SMEs stands at a mere 5.2%, far below the South Asian average of over 17%.
Why is this important? SMEs are the backbone of Pakistan’s economy, accounting for 90% of formally registered businesses, 40% of GDP, and 80% of non-agricultural employment. Their growth is crucial for national development and job creation.
NCGCL to the Rescue:
NCGCL, a joint venture between the Ministry of Finance and Karandaaz, will provide special credit guarantee facilities to SMEs. This will bridge the gap between businesses and lenders, making it easier for them to secure loans and invest in their growth.
Minister Highlights Benefits:
Finance Minister Dr. Shamshad Akhtar emphasized the potential of NCGCL to:
- Increase financial additionality in the market by 30-35%
- Boost productivity and innovation
- Generate more employment opportunities
- Create tailored products for over 1.5 million Pakistani SMEs
A Step Towards a Brighter Future:
The launch of NCGCL marks a significant step forward in supporting Pakistan’s SME sector. By facilitating easier access to credit, this initiative has the potential to unleash the entrepreneurial spirit of the nation and drive sustainable economic growth.
Stay tuned for updates on NCGCL’s progress and how it’s impacting Pakistan’s SMEs!
