UNISAME STRESSES ON RISK MANAGEMENT SKILLS FOR BANKS

The Union of Small and Medium Enterprises (UNISAME) delegation at the Expo/Seminar on 19th December 2016 organized by the State Bank of Pakistan (SBP) and the Small and Medium Enterprises Development Authority (SMEDA) to be held at a local hotel is focusing on stressing on the need for commercial banks for sharpening their risk management tools.

Zulfikar Thaver president UNISAME and chairman Capacity Building Work Group (CBWG) of the technical committee of the National Financial Inclusion Strategy (NFIS) said the commercial banks have to change their mind set and sharpen their own risk management skills to accommodate the SME sector. They need to adopt modern banking concepts like collateral management and warehouse receipt financing and export credit guarantee insurance to become comfortable in financing the sector.

He said the NFIS is determined to ensure inclusion of all segments of the society for financial inclusion. He complained that the agricultural and livestock sector are deprived of financing and stressed the need for crop and cattle insurance both to make the banks comfortable in financing the sectors.

Thaver said the medium sector is doing fairly well because of the support of the commercial banks but the small is still in turmoil as the commercial banks are not inclined to finance the sector.

The mark up rate of the microfinance banks is very high and unaffordable. If the limit of finance of the micro finance banks is increased to one million it will reduce their expenses and will prove beneficial for both the small entrepreneur and the micro finance bank to finance the micro entrepreneur as well as the small entrepreneur.

Thaver said that we will also emphasize the need to have dedicated SME branches and the early functioning of the Exim Bank and revival of the SME Bank to cater to the requirements of the sector.

The UNISAME delegation is expected to demand access to finance on the basis of positive cash flows, better leasing facilities for plant and machinery, housing and commercial property leasing.

Posted in: Press Releases