IFC and Habib Bank partner to expand lending to small businesses in Pakistan

Karachi: IFC, a member of World Bank Group, is helping improve access to finance and support the growth of small businesses in Pakistan through an agreement with Habib Bank to expand the bank’s small business lending programs.

IFC and Habib Bank will initially target the Lahore region-home to 45 percent of the country’s small and medium businesses where IFC will help Habib Bank design and roll out financial services and banking products aimed at small businesses. These products and services will then be launched country-wide through Habib Bank’s extensive branch network.

“This mandate will not only help Habib Bank better serve small and medium-sized business sector in Pakistan, but will also improve our procedures and develop the capacity of Habib Bank to support this market segment as it continues to grow,” said Mubashar Maqbool, Head of Habib Bank’s Commercial & Retail Lending Department on Thursday.

Kaiser Naseem, Head of IFC’s Bank Advisory Services in Middle East & North Africa region, said, “Through this project with Habib Bank, IFC is helping expand small businesses’ access to finance and supporting sustainable economic growth in Pakistan. Small business sector is a driver of job creation and economic growth, and supporting it is an important part of IFC’s work.”

Many banks regard lending to small and medium businesses as risky and lack tools and techniques to efficiently serve them. By helping improve Habib Bank’s ability to offer financing to these businesses, IFC’s participation will demonstrate benefits of lending to this market segment to other banks in Pakistan. With over 1,450 domestic branches, Habib Bank has strongest retail banking network in the country. This network, coupled with Habib Bank’s long experience serving small and medium enterprises will enable Habib Bank to develop and deliver new products.

Pakistan is a priority country for IFC. For past three years, IFC’s investments and advisory services work have increased in Pakistan to promote private sector growth. IFC’s strategy in Pakistan for fiscal years 2009 to 2011 focuses on mobilizing investments in power, infrastructure, providing access to finance to micro, small and medium enterprises through financial intermediaries.

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