On April 10, 2020 State Bank of Pakistan introduced a refinance scheme to provide concessional credit at 3% interest rate and generous repayment terms to any business that commits to not lay off workers for 3 months. The goal of the scheme was to provide an incentive to businesses to protect jobs. On May 06, 2020 SBP complemented this scheme with a 40% percent risk sharing facility (RSF) on first loss basis from the Government of Pakistan for utilization of this scheme for SMEs and small corporates (defined as business with annual turnover not exceeding Rs. 2 billion). As of June 12, 2020 there has been significant take up in the scheme. Banks have approved loan applications worth Rs. 107.5 billion of which Rs. 23.5 billion is for SMEs and small corporates under the risk sharing facility.
Banks performance under SBP Rozgar Refinance Scheme supported by Government of Pakistan’s Risk Sharing Facility
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