State Bank arranges microfinance study tour

Regulatory framework ranked best in the world.

KARACHI: To assess the viability of microfinance lending, the State Bank of Pakistan (SBP) recently organised a study tour for representatives of the Indonesian Central Bank (ICB) in Tando Allah Yar, to observe the current socio-economic conditions of low-income households in Pakistan.

At the study tour, SBP’s regional team briefed the delegation on the role of microfinance in the rural financial system and local economy development, and innovations in microfinance, particularly the latest developments in empowering the rural population.

The participants were also acquainted with functions of microfinance organisations and the various programmes offered to support small businesses.

Pakistan has recently become successful in developing the microfinance sector due to deep analysis of the regulating framework for organisations. Currently, there are over two million active borrowers in the country.

A recent publication of the Economist Intelligence Unit on ‘Global microscope on the microfinance business environment in 2010’ ranked Pakistan number one in terms of regulatory environment.

Published in The Express Tribune, February 12^th, 2011.