SBP aims to achieve 50pc financial inclusion by 2020: deputy governor

KARACHI: The State Bank of Pakistan (SBP) is pursuing a three-pronged strategy to achieve the goal of 50 percent financial inclusion by the year 2020, said Saeed Ahmed, deputy governor of the central bank, on Thursday.

"Twenty million households need microfinance in Pakistan. So far, we have achieved access to 4.3 million borrowers, so we still have a long way to go to reach the target of 50 percent financial inclusion by 2020. Equitable economic growth and financial inclusion is the key to progress,” he said, while addressing the 10th Microfinance Country Forum 2016.

The forum, organised by Shamrock Conferences International in collaboration with BRAC Pakistan, Mobilink, Microfinance Bank and Khushhali Microfinance Bank, was held to strive for expansion of the outreach of financial services and enterprise-acumen at the grassroots level.

Microfinance Recognition Awards were also launched as a part of this forum.

Ahmed said, "The SBP is creating a favourable regulatory environment for the microfinance sector, while providing cheaper financial resources and building infrastructure to reduce the cost of delivery of funds. It will continue to facilitate the borrowers and ensure their protection."

Dr Mohammad Amjad Saqib, founder and chairman of Akhuwat Foundation, delivered the keynote address and stressed the importance of nurturing microfinance as a purely humanitarian intervention, rather than one that focuses on purely commercial objectives.

Merging of the microfinance delivery methods with the interest-free financing model has given a tremendous boost to the sector, adding a truly philanthropic and humanitarian perspective to the operations, he said.

This model has been successfully deployed by the Akhuwat Foundation and some other institutions and has shown rapid sustainable growth.

Zubyr Soomro, chairman of the Pakistan Microfinance Investment Company, stressed on the need to create a technology platform, which should be accessible to all the microfinance institutions to facilitate them in the adoption of latest technologies.

The microfinance professionals should work more cohesively with the vocational training institutions, that are preparing skilled entrepreneurs and who need microfinance support, he said.

A trained workforce with specialised skills and a humanitarian approach towards business is needed to be nurtured to drive the microfinance sector in the future Soomro said.

Pakistan Microfinance Network (PMN) CEO Syed Mohsin Ahmed said, “We would urge the industry to swiftly adopt the technological advancements that are enabling wider, cheaper and instant outreach of financial services, to the deprived and remote segments.”

“Microfinance can also help us overcome the biggest challenges like strengthening of educational infrastructure. Micro-insurance also has a great potential,” he added.

SHAMROCK Conferences International Chairman and Founder/Convener of the Forum Menin Rodrigues said, “In order to encourage the microfinance institutions, to continue with their vigorous ventures, we have conceived the Microfinance Recognition Awards as part of the annual microfinance forum.”

These awards are being presented for the first time to more than 30 outstanding microfinance banks and institutions for their valuable contributions, he added.

The speakers and microfinance experts said social development and providing the masses with ample opportunities of entrepreneurship to earn respectable income should be the driving force behind all microfinance initiatives in the sector.

Reducing financial exclusion is the most critical need of the country during these challenging times. The microfinance specialists must create a sustainable model by offering competitive microfinance products, reducing costs and expanding their outreach through the use of innovative technology-based financial channels, they added.

Others who spoke on the occasion included Programme Manager, IFC Lighting Pakistan, Marco Indelicato; CEO, BRAC Pakistan, Sher Zaman; CEO, Balochistan Rural Support Programme, Nadir Gul Barech; CEO, Thardeep Microfinance Foundation; Sono Khangharani; CEO, Agahi Resource Center Dr Rakhshinda Perveen; Country Manager, Pakistan MicroEnsure, Rehan Butt and CEO, Damen Support Programme, Naghma Rashid.

Over the last 10 years, this highly successful forum has facilitated powerful reforms in the sector by attracting leading microfinance practitioners, regulators, government officials, NGOs, academia, media and professional delegates from prestigious financial institutions.