By Commerce Reporter
LAHORE – State Bank of Pakistan (SBP) Governor Jameel Ahmad’s announcement of enhanced financing facilities for small and medium enterprises (SMEs) has been welcomed by the business community, with Lahore Chamber of Commerce and Industry (LCCI) President Ali Hussam Asghar proposing a practical financing model for 1,000 businesses to improve their access to institutional credit.
LCCI Executive Committee Member Muhammad Yasin appreciated the SBP’s initiatives, particularly the increase in the collateral-free SME loan limit from Rs10 million to Rs50 million. He also praised Ali Hussam Asghar’s proposal to select 1,000 SMEs, identify their financing constraints and develop a workable facilitation mechanism in collaboration with the government, SBP, EXIM Bank and commercial banks.
Yasin said the proposed initiative could help identify the actual difficulties faced by small and medium businesses in obtaining bank financing and develop practical solutions through coordinated efforts. He said successful implementation of the model could provide a framework for extending similar facilities to businesses across the country.
Addressing a meeting at the LCCI, SBP Governor Jameel Ahmad said expanding SME financing was among the government’s key economic priorities, alongside agriculture, housing and exports.
He announced that the collateral-free loan limit for SMEs had been increased from Rs10 million to Rs50 million. The annual turnover eligibility limit for small enterprises had also been raised from Rs150 million to Rs400 million, while that for medium enterprises had increased from Rs800 million to Rs2 billion.
Ahmad said outstanding SME financing had grown from Rs491 billion in June 2024 to Rs691 billion in June 2025 and approximately Rs1,110 billion in June 2026. The number of SME borrowers also increased from 177,000 to around 325,000 during the same period.
He further announced that the SME Connect Portal would become operational on November 1, allowing entrepreneurs to apply for financing online and track their applications. The SBP, in collaboration with SMEDA and commercial banks, had also simplified the SME loan application form to a single page.
LCCI President Ali Hussam Asghar said a joint financing mechanism involving industry, the government and commercial banks could accelerate SME development. Under his proposed model, 1,000 businesses would be selected on the basis of available data, their financing obstacles identified and a practical support mechanism developed.
He also urged the SBP to link its complaint centre with the LCCI’s complaint centre to address banking-related problems faced by importers and exporters, particularly delays in opening letters of credit.
Asghar proposed performance-based financing incentives for businesses increasing employment, arguing that companies creating additional jobs should receive special financing support.
LCCI Senior Vice President Sardar Usman Ghani highlighted the potential of Islamic banking in SME financing, proposing a minimum 5.9 per cent SME financing target for Islamic banks. He said achieving this target could generate an additional Rs204 billion for SMEs.
LCCI Vice President Chaudhry Khadim Hussain also called for practical implementation of the proposals discussed at the meeting to strengthen businesses and support economic development.
