KARACHI: Prime Minister Shahid Khaqan Abbasi launched the financing policy for the promotion of small and medium enterprises (SME) at the State Bank of Pakistan (SBP) on Friday.He also launched a separate scheme for the promotion of home remittances through mobile wallets, also known as m-wallets.The prime minister said that the nine pillars identified under the SME policy address specific issues faced by companies belonging to that sector. He said the policy is expected to help curtail the level of reluctance of financial institutions to provide SMEs with financing.These pillars include improvement in the regulatory framework, up-scaling through microfinance banks, risk mitigation strategy, simplified procedures for SME financing, programme-based lending and value-chain financing, capacity building and awareness creation, non-financial advisory services for SMEs through the banking channel, leveraging technology for the promotion of SME banking and simplification of the taxation regime for SMEs.“My government fully supports the proposed measures for the promotion of SME finance, including the establishment of a credit guarantee company for offering the risk-sharing facility for SMEs, and the setting up of secured transactions collateral registry under Financial Institutions Secure Transactions Act 2016 by July 1, 2018,” said the premier.He said the scheme will help channelize home remittances through branchless banking (BB).
“It will help achieve twin objectives. Firstly, it will facilitate the populace by the provision of home remittances in swift, convenient and cost-effective manner by utilising the network of BB agents across Pakistan; secondly, it will help enhance the usage of m-wallets and the creation of digital accounts,” he said.Mr Abbasi also announced the government’s budgetary support to incentivise home remittances through m-wallet accounts.“Unfortunately, Pakistan is among the countries accounting for around five per cent of the world’s unbanked population. Only 23pc of the adult population has access to formal financial services,” he said.He said remittances have been the biggest source of foreign exchange earnings for the country after export receipts. “Over the past 10 years, remittances have grown at a compound annual growth rate of over 12pc – one of the highest growth rates for any country in the world. Pakistan’s relatively better performance in the region is principally attributed to a sustained increase in emigrant workers during the past few years and supportive policies of the government and the SBP,” he said.SBP Governor Tariq Bajwa said the industry progressed remarkably during the last few years. As of June 2017, 27.3 million m-wallets (BB accounts) have been opened while the number of BB agents has increased to 402,000.
He said all BB service providers and individuals receiving home remittances are eligible for this scheme. A new category of BB Level-1 account — home remittances account (L1-HRA) — is required for receiving remittances through this scheme. There is no initial deposit and minimum balance requirement.For each dollar received, the HRA holder will earn the air time of Re1 in the registered SIM against the account. The incentive is being provided through public-private partnership shared equally between the government and the BB provider.Beneficiaries will be able to withdraw cash from ATMs, respective bank branches or thousands of branchless agents. Furthermore, they will be able to make digital payments to settle their utility bills etc by using their m-wallets.
APP ADDS: Separately, Mr Abbasi attended on Friday a ceremony to mark the upgrade of Rs15 billion white oil pipeline, which will provide upcountry areas with uninterrupted petrol and diesel in a cost-effective and efficient manner.He said the 786-kilometre-long strategic project will strengthen the country’s energy security. He expressed the hope that the project involving multi-grading of the oil pipeline will complete by 2019.He mentioned that a tanker leaves the storage facility at the port every two minutes, adding that the utilisation of the oil pipeline will reduce the load on roads. He said efforts were also under way to upgrade the fleet of the country’s 10,000 tankers and make them safer.akistan’s petrol consumption was increasing at a rate of 20pc while that of diesel was rising 12pc. He said tankers will continue to provide secondary transportation and witness an increase in their services.Mr Abbasi said that with the full utilisation of the oil pipeline, the cost of transportation will drop by Rs1-1.50 per litre.The infrastructure project, owned by Pak-Arab Pipeline Company (Papco), will pump diesel and petrol to central Pakistan, which has a share of almost 60pc in total petroleum consumption. The transportation capacity of the 26-inch-diameter pipeline system is 8m tonnes per year, which can be enhanced up to 12m tonnes. The project will provide additional strategic product storage of about 221,000 tonnes.The pipeline starts from Karachi and terminates at Mahmood Kot, near Muzaffargarh. It has three pumping and terminal stations at Port Qasim, Shikarpur and Mahmood Kot.Pak-Arab Refinery Company (Parco) owns a 51pc stake in Papco while Shell, Pakistan State Oil and Total Parco Marketing Ltd have 26pc, 12pc and 11pc shares, respectively.It will cut the cost of transportation from Karachi to Mahmood Kot by half.
