Launching ceremony of Pakistan Micro-Finance Company held

Federal Minister Senator Mohammad Ishaq Dar launched the Pakistan Microfinance Investment Company (PMIC) in Islamabad.

The finance minister said the government fully recognised that financial inclusion can be a strong impetus for economic growth in Pakistan. He said that the National Financial Inclusion Strategy launched on May 2015 was a pivotal step to address the financial services needs of the poor and underserved segments of the country.

The minister said that the government’s economic policies under the leadership of Prime Minister Muhammad Nawaz Sharif had put the country on the road to macroeconomic stability and now our target is to achieve a higher sustainable and inclusive growth.

Senator Dar apprised that the growth momentum continues to remain above 4 per cent for the 3rd year in a row with real GDP growing at 4.71 per cent in FY 2016 and target of 5.5 per cent for the current fiscal year.

PMIC is incorporated as a public limited company under the Companies Ordinance and regulated by the Securities and Exchange Commission of Pakistan. It has been created by Pakistan Poverty Alleviation Fund, the leading non-profit apex funder for microfinance, Karandaaz Pakistan, a nonprofit company setup to promote small business lending and digital financial services with funding from the United Kingdom Department for International Development (DFID), and KfW (the international German Development Bank).

High Commissioner of United Kingdom Thomas Drew, German Ambassador Ina Lepel, Head of Office DFID Pakistan Joanna Reid and PMIC Board of Directors Chairman Zubayr Soomro also addressed the audience.

The British high commissioner congratulated the finance minister on his leadership to establish the PMIC and said that micro-finance will have a key role to play in export led growth for Pakistan. The German ambassador appreciated the patronage of the finance minister to establish PMIC and said that the German government was proud to support the PMIC initiative as it fits well into Germany’s objective of supporting technology startups and green energy through microfinance initiatives worldwide.

The finance minister appreciated the partnership of the British and German governments in establishing PMIC with a total equity of Rs6+. 6.00 billion in which government of Pakistan through the Pakistan Poverty Alleviation Fund has a shareholding of 49 per cent, DFID through Karandaaz holds 37 per cent shares and German Development Bank KfW has a 14 per cent share.

He said that PMIC would provide access to finance to the underserved poor segments of the society who have difficulty in accessing financing for development of income generating activities. He urged that the fundamental objective of PMIC was to offer small loans and other financial services with the aim to graduate the youth of Pakistan from cash transfer social safety nets to income generating sustainable livelihood.

Ishaq Dar said that the potential market for micro-finance in Pakistan is 20-25 million. “It is a pleasure to see that the seed PML- N government sowed in the shape of setting up PPAF in 1997 has become a tall tree, providing shade and livelihoods to the poor”, he said.

Appreciating the dedication of PPAF CEO and officials, the minister said that as a result of hard work over the years, the micro-finance sector in Pakistan now serves around 3.5 million borrowers and would serve at least 10 million borrowers by 2020 through institutional structures like the PMIC.

PMIC Chairman Zubyr Soomro, PPAF CEO Qazi Asmat Issa and PMIC CEO also spoke on the occasion and appreciated the support of the Ministry of Finance; State Bank of Pakistan, the SECP and Competition Commission of Pakistan is setting up the regulatory and corporate structure of PMIC. The ceremony was attended by a large number of dignitaries including British high commissioner, German ambassador to Pakistan, senior officials from Ministry of Finance, SECP Chairman, PPAF representatives, multilateral institutions and members of business community.

The event was closed with remarks from PMIC CEO Shahid Mustafa, who thanked all the participants and expressed the hope that PMIC would make a positive mark in the microfinance domain in the near future.