The destruction caused to the sector by the closing of the SME Bank.
According to businesspeople, micro, small, and medium-sized businesses are not treated seriously.
KARACHI:
The Small and Medium Businesses (SME) Bank’s recent announcement of its permanent closure has left its members disappointed and heartbroken. The government chose to close the bank instead of pursuing the privatization or merger that the SME sector had hoped for.
The Union of Small and Medium Businesses (UNISAME) President Zulfikar Thaver stated in an interview with The Express Tribune that “the SME sector was heartbroken because of the ultimate decision to close the SME Bank instead of privatizing or merging it.”
Thaver was also disappointed that the government did not even operate it as a dedicated SME bank to meet the diverse demands of the industry.
Based on recommendations from the State Bank of Pakistan, the federal cabinet decided to close the SME Bank on Friday (SBP). The management of the SME Bank was given instructions by the prime minister Shehbaz Sharif to maintain the security of customer deposits throughout the winding-down process. It was decided that all bank clients will get a total of Rs5.557 billion as part of the initial phase.
The winding down procedure will take more than three months, a top SME bank official told The Express Tribune.
Thaver remarked that although the SME Bank was established simultaneously in Malaysia and Pakistan and is doing well there, it was not established there.
Thaver stated that “In Pakistan, micro to medium-sized entrepreneurs are not taken seriously, despite the fact that this sector is the majority and is considered the backbone of the economy,” despite the potential of the SME sector. He asked the government to examine the sector’s potential, help it grow, and set up joint ventures, technology transfers, collaborations, and partnerships with China and other nations that were sincerely looking to work together.
According to Thaver, the SME Bank’s shutdown serves as a reminder of the bureaucracy’s and the cabinet’s apathy. The head of UNISAME reaffirmed that SME farmers had enormous potential and that, if supported, this nation would have advanced quickly.
In order to prevent bankruptcy brought on by irresponsible expenditure and the waste of time, energy, and resources, he cautioned the government not to make the same mistakes and to take the SME sector seriously.
According to Thaver, Pakistan’s transition to an import-dependent economy is solely due to a lack of SME development and promotion.
