ADB $20 mln loan to increase credit access in Pakistan


KARACHI, May 22 (APP): The Asian Development Bank (ADB) has
approved a USD 20 million loan to help Pakistan’s Khushhali
Microfinance Bank (KMBL) to expand access to credit for
agriculture-related borrowers and small businesses.
This was pointed out in a statement issued here on Monday on
behalf of the KMBL.
‘Agriculture and small business are critical sectors in
Pakistan’s economy that play a significant role in job creation and
poverty reduction’, said Ms. Christine Engstrom, Director of ADB’s
Private Sector Financial Institutions Division.
‘ADB’s assistance will help support KMBL’s goal to improve
financial inclusion to these sectors through their extensive expertise
and outreach to underserved populations’, it was further pointed out.
The ADB assistance will help KMBL- Pakistan’s largest
microfinance bank, increase the provision of financial services to
micro, small, and medium-sized enterprises (MSMEs) from 5,700 today to
over 30,000 by 2020.
Women are expected to comprise up to 25% of loan recipients. A
separate technical assistance program will support the establishment
of a MSME training academy as well as investments in Khushhali
Microfinance Bank’s ‘technology up gradation’ program, the statement
‘ADB’s support will deepen the market penetration of KMBL into
the rural economy and enhance access to small businesses vital to
economic growth and prosperity, says Ghalib Nishtar, President of
KMBL. ‘In the past 16 years, KMBL has led the way towards financial
inclusion by offering loans and savings products tailored to the low
income segment of the market, and empowering women entrepreneurs
belonging to the marginalized communities by creating awareness and
providing opportunities of financial access through its value
Access to finance in Pakistan is limited, with only 24% of the
adult population having a bank account with a formal financial
institution, while MSMEs face difficulty securing financing from the
banking sector.
KMBL has a nationwide presence in Pakistan with a network of 144
branches and the largest client base among microfinance banks in the
country. At the end of 2016, KBL had over 550,000 active borrowers and
managed a gross loan portfolio of over PKR 23 billion ($220 million).
ADB, based in Manila, is dedicated to reducing poverty in Asia
and the Pacific through inclusive economic growth, environmentally
sustainable growth, and regional integration.
Established in 1966, ADB is celebrating 50 years of development
partnership in the region. It is owned by 67 members- 48 from the region, the statement added.