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Small farmers get Rs 2.83b financing

21 February, 2013

KARACHI: The State Bank of Pakistan's (SBP) Credit Guarantee Scheme (CGS) has helped small enterprises and farmers to access Rs 2.83 billion in bank financing over the last 18 months.

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KARACHI: The State Bank of Pakistan's (SBP) Credit Guarantee Scheme (CGS) has helped small enterprises and farmers to access Rs 2.83 billion in bank financing over the last 18 months.

The scheme (CGS) has facilitated financing in 105 districts across the country with 85 per cent of loans provided to previously un-served/under-served clients in rural areas, of which 81 percent were subsistence farmers. Similarly, 91% of the loans under the scheme were provided to small businesses with less than five employees of which 90 percent were sole proprietors.

Under the CGS, banks also focused on serving the lower end of the commercial banking market through smaller loans, with an average loan size of Rs 390,000 for agriculture and Rs 2.1 million for small enterprises. Based on client needs, the loan tenor under the CGS ranged from less than one year to three years.

The scheme through its support to previously unbanked small rural enterprises is likely to further enhance economic opportunities and increase employment in the rural areas of the country.

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