SMEs offer huge opportunity to banks: Tiwana
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–> Small and Medium Enterprises (SMEs) offer a huge opportunity for commercial banks to expand their secure lendings, as the recovery rate from SMEs is the highest in the industry. Addressing 6th SME conference organised by Shamrock Communications here on Wednesday, Director of Smeda Sultan Tiwana said that in the most developing countries, the ratio of SMEs’ non-performing loans has been as low as 2 to 7 percent.
“Even in Pakistan, targeted financing facilities launched for CNG rickshaw owners and gems and jewellery makers gave excellent results with almost zero percent default ratios”, he added. During the presentation sessions, Kalimur Rahman, CEO, JS Bank Ltd said that in Pakistan, only 7 percent of the SME’s have availed bank financing facilities. Thus, these services are highly under-utilised in this critical sector. He also emphasised the need for a specialised SME Bank as well as trained SME bankers catering to the exclusive needs of the sector.
Javed Iqbal, Project Manager, Business Edge, IFC-World Bank Group elaborated
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