Despite their immense contribution towards economic growth and job creation, SMEs in Pakistan have always faced insurmountable challenges in getting timely financing. The share of SME loans in the overall private sector financing across Pakistan remains within the range of 6% to 9%. Though the State Bank of Pakistan (SBP) has taken several initiatives to enhance SME financing, less than 5% of SMEs operating in Pakistan are availing funding from banks and development financial institutions (DFI). Against this backdrop, Pakistan can leverage its high mobile phone penetration rate (85%) to reach SMEs via fintech channels.
