FAISALABAD. State Bank of Pakistan (SBP) is providing cheap financing facilities with minimum mark up rate to 5 important segments for the speedy, balanced and systematic industrial, economic and commercial growth in the country, said Mr. Waqas Kashif Bajwa Chief Manager SBP Faisalabad.
Addressing an awareness session on Export Refinance Scheme, he said that economic growth is tagged with multiple factors. However the provision of finance is the sole responsibilities of SBP.
Pointing out the 5 major sectors, he told that these include SME, women entrepreneurs, promotion of renewable energy resources, Islamic banking and up gradation of industrial units.
He briefed about the salient features of these schemes and told that among these include short and long term measures.
Regarding export refinancing scheme, he told that this is the oldest scheme introduced in 1973. Under this scheme working capital is provided for 180 days at a markup rate of only 3 percent.
Similarly, the foreign proceeds are to be repatriated within another 180 days. He told that 99 percent exporters are availing from this facility as its negative list is very negligible.
The ultimate objective of this negative list is to protect the domestic value-added sector. He also explained the part 1 and 2 of this scheme with other modalities and told that Faisalabad based exporters are fully utilizing this scheme.
Regarding loans for renewable energy, he told that under this scheme loans could be procured for a period of 10-12 years with a fixed markup rate of 6 percent.
He said that people should avail from this scheme by setting up their own units to meet their domestic, commercial or industrial needs.
Commenting on the problem confronted by the SME sector in getting fresh loans, Chief Manager told that SBP has declared it mandatory for all commercial banks to allocate at least 10 percent of their total loan portfolio for the SME sector.
He further told that earlier there was no clear demarcation between small and medium units which has now been clarified explicitly.
Regarding long term finance, he told that under this scheme subsidized loans up to Rs.1.5 billion could be applied which could be provided for a period of 10 year at a markup rate of 6 percent. “It could be used for up gradation, balancing and modernization of existing industrial units”, he added.
Regarding loans allocated for the women entrepreneurs, the Chief Manager SBP said that bank provide this loan at zero markup in addition to sharing 60% of the loss if incurred. The concerned scheduled bank will provide this loan at only 5 percent mark up as the objective of this scheme is to encourage the female entrepreneurs to start their own businesses.
He further told that Islamic Banking is yet another sector which is growing at a much faster pace. “We are encouraging it to cater to the needs of the people who are inclined towards Islamic Banking he added. As it is comparatively new sector compared to the conventional banking, it was introducing new products which are fully compliant to the Islamic Sharia. He said that earlier in some cases only nomenclature of the banking was changed but now we are expecting really Islamic banking products in near future.
He also discussed the issue of KIBOR and said that SBP as well as other banks are also trying to resolve this issue without any unnecessary delay.
Regarding SME loans to power looms and sizing sectors, he said that initially these sectors were not included in the scheme. He asked representatives of the concerned sectors to apply through FCCI and their concerned associations with proper justification to include these sectors in this scheme.
Earlier in his address of welcome Mr. Shabbir Hussain Chawla, President FCCI thanked SBP for organizing this awareness session on refinance schemes launched by SBP. He expressed concern that Pakistan’s exports are declining for the last many years. It is more alarming that trade deficit has jumped to 32.58 billion dollar during 2016-17. He told that during first four months of the current fiscal year the trade deficit has also increased to $ 9.73 billion which was $ 6.98 billion during the same period of last year. He further said that during the last 12 years various countries have made tremendous progress in their exports while Pakistan has achieved only 27% increase in its exports. He said that only way to overcome this situation is to enhance exports and in this connection, the schemes launched by SBP would play a major role. He also demanded that SBP should relax prudential rules for the revival of sick units which have potential not only to increase exports but also create new job opportunities.
Responding to electricity generation in private sector, he said that two proposals relating to Faisalabad have been processed while many more are in the pipeline.
Mr. Haleem Akhtar, Haji Talib Hussain Rala and Mumtaz Shahid Bajwa raised interesting questions. Later SVP Sh. Farooq Yousaf, offered vote of thanks while VP Usman Rauf presented FCCI shield to Chief Manager Waqas Kashif Bajwa.
President FCCI and SVP also decorated Mr. Muhammad Younis and Mr. Muhammad Rashid of SBP with FCCI pins. Secretary General FCCI Mr. Abid Masood and Ms. Iqra Qadeer Secretary FWCCI were also present.
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FAISALABAD. Group photo of Mr. Waqas Kashif Bajwa Chief Manager SBP Faisalabad with Mr. Shabbir Hussain Chawla president, Sheikh Farooq Yousuf SVP, Mr. Usman Rauf VP FCCI and others during a seminar on Export Refinance Scheme.