ISLAMABAD: Achieving private sector-led growth through financial inclusion in Pakistan requires a comprehensive approach that involves the government, financial institutions, and private sector players. By working together to increase access to finance, promote financial literacy, and support entrepreneurship, Pakistan can promote private sector growth and reduce poverty, says Sajjad Ahmed Warraich, Head of Business Development and Marketing Division at the SME Bank, while talking to WealthPK.
“Financial inclusion is a key factor in promoting private sector growth in Pakistan. When more people have access to financial services, they are better able to start and grow businesses, invest in education and healthcare, and save for the future. This creates a more inclusive and dynamic economy, which can help reduce poverty and drive economic growth.”
“In recent years, the financial sector in Pakistan has experienced significant structural changes in the form of increased growth, innovation, and efficiency. Pakistan has adopted financial inclusion as a national priority. It has advanced significantly in recent years, greatly helping the society to access financial services.”
“A number of innovative and new financing vehicles have emerged, including real estate investment trusts, private equity funds, and housing finance companies, which are all changing the way the financial sector operates. Compared to its peer economies, Pakistan’s financial sector remains small and has a limited role in private sector financing.”
“Developing SMEs is one of the initiatives being pursued by the government and the State Bank of Pakistan in order to encourage economic development. The government’s initiatives offer programs that support the growth and expansion of SMEs through access to cheap and affordable finance,” said Warraich.
“Through strategic partnerships, the SBP has enhanced financial inclusion not only in the country but with international financial institutions and development agencies to boost knowledge, acquire technical expertise, and instil regulatory and practitioner capacities besides funding support for market development and fostering innovations,” he added.
“The key to achieving private sector growth in Pakistan is to increase financial inclusion at a fast pace. The government should develop policies and regulations that promote financial inclusion, while the private sector can invest in developing innovative financial products and services.”
“In order to resolve the structural impediments to enhancing the flow of finance to the private sector, the government, regulators, and stakeholders need to work together. It is necessary to reduce the fiscal deficit in order to free up resources for the private sector by reducing government borrowing from the financial sector.”
“The country’s digital infrastructure, including broadband internet and payment gateway systems, is still in the developing stage and may not be able to handle the increasing demand for digital financial services. Therefore, financial institutions need to address this issue,” he added.
