SBP, SMEDA, PBA launch simplified SME loan application

LAHORE: The State Bank of Pakistan (SBP), the Small and Medium Enterprises Development Authority (SMEDA), and the Pakistan Banks Association (PBA) have jointly developed a simplified SME loan application form under the directive of the prime minister of Pakistan.

The form was unveiled at a seminar organised by SMEDA at a local hotel. The event was attended by key figures, including CEO of SMEDA Socrat Aman Rana; member of the Prime Minister’s Steering Committee on SME Development Aasia Sail; CEO and Vice Chairman of the PBA Munir Kamal; Additional Director of the SBP Najam-us-Saqib; Head of Commercial Banking at Faysal Bank Altaf Hussain Saqib; Product Head for SME at JS Bank Umair Zaman Khan; and Regional Business Head-SME at Bank of Punjab (BOP) Umar Rauf.

A large number of representatives from the banking industry, chambers of commerce, trade associations and businesses from Lahore, Karachi, Peshawar, Quetta, Azad Jammu and Kashmir, Gujranwala, Faisalabad and Rawalpindi attended the seminar with great interest.

The CEO of SMEDA highlighted the crucial role SMEs play in the country’s economy. Despite their importance, he said, SMEs have long faced barriers in accessing formal financing, primarily due to the complex nature of loan applications and the low financial literacy of business owners. Rana added that SBP, PBA, and SMEDA are working together to fulfil the prime minister’s vision of enhancing easy and adequate access to finance for SMEs. “The launch of a simplified and unified loan application form for SMEs is a significant first step towards this goal,” he stated. “SMEDA, with support from the PM Steering Committee on SMEs, SBP, PBA, and the Ministry of Industries and Production, is committed to doing much more to support the rapid and sustainable growth of SMEs. We are planning initiatives focused on handholding, capacity building, training, and expanding finance, grants and loan schemes for SMEs.” He also expressed gratitude to the prime minister, the minister of MOIP, the secretary of MOIP, and all stakeholders for their support in making this initiative a reality.

Rana also discussed key improvements in the new loan application form, stating, “We have simplified the form’s structure, reducing the number of data entry sections, which should speed up the application process and make it easier for businesses to apply for loans.” He added that the streamlined process would also benefit banks by reducing paperwork and accelerating approvals.

Aasia Sail praised the CEO of SMEDA for his dedication to removing barriers for SMEs and commended the Prime Minister for prioritizing the sector.

Kamal said that Pakistan, like its neighbouring countries, needs to base its economic development on the SME sector, with SMEDA playing a pivotal role. He recommended developing SMEDA to align with international development organisations.

Najam-us-Saqib noted that the simplified loan application form should be the first of many steps to streamline the entire loan process at the bank level, with the goal of doubling SME financing over the next five years. A presentation at the seminar revealed that the amount of business information required for SME financing has been reduced to a reasonable level. “The number of documents required has been cut down. SME applicants now only need to submit three documents, while ME applicants need four, making the loan application process faster, simpler, and less overwhelming for SMEs.”

Representatives from the business community praised SMEDA’s efforts to simplify the loan application form, stating that the new process would enhance SME financing and enable enterprises to unlock new growth opportunities.

Representatives from the banking industry assured that they would implement the new application process in full to foster the sustainable growth of SMEs and meet their financing needs.