The IT minister commended the management team for the incredible turn-around story for U Bank Microfinance Limited, formerly known as Rozgar Microfinance Bank, over the last four years and discussed the bank and government’s mutual agenda to achieve greater financial and social inclusion in Pakistan.
Islamabad: (Parliament Times) The Federal Minister for IT & Telecommunications Dr. Khalid Maqbool Siddiqui on Wednesday visited the U Microfinance Bank Ltd. Head Quarters in Islamabad. U Bank is a wholly owned subsidiary of Pakistan Telecommunication Company Limited (PTCL) – Etisalat Company. The bank has a network of over 200 branches and touch-points, across 160 cities and rural areas in Pakistan and offers a wide range of microfinance loans, deposit products and branchless banking solutions. U Bank’s branchless banking offers services under the banner of U Paisa in collaboration with Ufone (Pak Telecom Mobile Limited). The service is offered at more than 40,000 agent locations across Pakistan. Currently, U Bank serves more than 850,000 customers, where 22% of the served customers are women. The number of U Bank’s employees also grew by 50% during the year crossing the 2000 mark, where 9% of the total workforce comprises of women.
Driven by the passion for disruptive innovation and the desire for financial inclusion, U Bank aims to become the problem solver and enabler to the Pakistani microfinance ecosystem. U Microfinance Bank Ltd. Is committed to fight poverty in Pakistan. Over the last 4 years it has made important contributions towards implementation and achievement of the national financial inclusion agenda put forth in the National Financial Inclusion Strategy 2023 that aims to bring 50% of Pakistan’s adult population into the banking net. Over these years the bank has demonstrated exceptional growth and our network outreach has gone from 28 branches to 200 branches with its portfolio having grown from PKR 900 million to PKR 21 billion as of closing figures for the last quarter (ending September 2019). U Bank also boasts of 305,000 active borrowers and 400,000 depositors with a deposit of PKR 20 billion. In 2018, the bank also recorded impressive profit growth of 111% compared to the previous year. In addition, the banks net equity has gone from PKR 1 billion to currently PKR 2.5 billion tier I and PKR 4 billion tier II.
As a microfinance bank its mission stems directly from United Nations’ Sustainable Development Goals – SDGs, also called the Global Goals for Sustainable Development (Agenda 2030). These goals, in particular Goal # 2 Zero Hunger, Goal # 8 Decent Work and Economic Growth, Goal # 9 Industry, Innovation & Infrastructure and Goal # 10 Reduce Inequalities, act as guiding principles for the bank. Pakistan is currently going through a critical period. 38% of the children under the age of five years are stunted, one of the highest prevalence in the world. This situation is particularly grave in Sindh, where approximately 50% of children are affected and the number is constantly rising. On the Human Development Index, Pakistan has a score of 0.562 according to the latest data available, the lowest in the South Asian Region. Furthermore, 22.6 million children remain out-of-school. These development emergencies, as well as the current tough and corrective phase Pakistan’s economy is undergoing, demands the attention and action of all players, be it government or private sector to help alleviate the economic conditions of our people. U Bank is hyper aware of these stark realities and remains committed to ensuring that its work continues to serve the underserved people of Pakistan. The research confirms that that often microfinance brings shock absorbing capacity to its customers to weather times of economic hardship stemming from crop failures, illness/death, natural disasters etc. Therefore, as a national institution U Bank remains committed to performing its duty towards its customers and the communities it serves. The contribution of U Bank towards the achievement of these SDGs’ and NFIS goes beyond simply financial uplifting and increasing income – rather the bank, with its vast range of creative products and the services positively impacts health, education, house-hold emergency management capacity, woman empowerment/gender equality, small industry uplifting, as well as providing environmental protection and renewable energy, among others.
As an organization U Bank also remains primed to become a forerunner in the future of banking by solving the critical challenges faced by customers and providing them with ever improving value-added services. Having established its physical footprint across the nation, the next challenge that the bank is taking on is that of digital transformation to further expand its reach to customers at the last mile who have historically remained neglected by the banking industry. According to a study by Google, by 2030 Pakistan is projected to be the fourth fastest growing digital economy thanks to the significant gains in IT/Telecom infrastructure and connectivity (with further investments being made still), e-commerce, e-governance and service delivery, digital finance education and agriculture (land record digitization, farming advisory services etc.)
U Bank, for years 2020 and beyond, aims to achieve operational excellence by investing in and leveraging technology to set industry standards, while benefitting from process automation and innovation. The bank will also continue to use its branchless banking license in catering to the last mile customer. Branchless Banking and digitization will thus remain two key focus areas for the bank. U Bank has embarked upon the journey towards becoming a digital bank that is prepared to deliver value and services via technology, enabling it to potentially become one of the most accessible banks in the country, whilst ensuring that it continues to substantively contribute to the SDGs & NFIS goals.
