SMEs, agriculture: Govt doubles financing targets: Aurangzeb

ISLAMABAD: The government has set an ambitious target to double financing for small and medium enterprises (SMEs) and agriculture to Rs2 trillion each by June 2028, while housing finance under the Prime Minister’s flagship affordable housing programme has surged to Rs351. 3 billion, Finance Minister Senator Muhammad Aurangzeb said on Wednesday. Chairing the fourth meeting of the Access to Finance Steering Committee, the minister directed banks and relevant institutions to shift their focus from approvals to actual disbursements, stressing that financing frameworks would have little impact unless they translated into credit, investment and economic activity on the ground. The meeting reviewed progress on initiatives aimed at expanding affordable and inclusive finance across priority sectors, including SMEs, agriculture, information technology (IT), exports, renewable energy and housing. The Committee reviewed the latest position of SME financing. The Steering Committee was informed that by the end of August 2026, SME finance stood at Rs1. 067 trillion, serving 323, 987 borrowers and accounting for 9. 90 percent of domestic private advances. The medium-term aspiration is to expand SME financing to Rs2 trillion and the number of borrowers to 775, 000 by June 2028, raising its share to 13 percent. The Finance Minister emphasised the importance of maintaining momentum towards these targets and called for a clear bank-wise plan to strengthen SME credit growth over the coming months. He also welcomed progress on the wholesale SME financing framework, which is expected to help broaden outreach and expand the number of businesses able to access formal financing. The Committee also reviewed agriculture finance, which reached Rs1. 268 trillion by the end of August 2026, covering 3, 392, 092 borrowers and representing 10. 90 percent of domestic private advances. The medium-term target is to increase agriculture finance to Rs2 trillion and expand the borrower base to 5. 5 million by June 2028. On housing finance, the Committee noted significant momentum under the Wazir-e-Azam Apna Ghar Programme – Ghar Ho To Apna, which provides affordable housing finance for tenors of up to 20 years, with a fixed 5 percent rate for the first 10 years. By September 4, 2026, approved housing finance under the programme had reached Rs351. 3 billion, increasing by Rs38. 3 billion since end-August — a significant 12 percent increase in less than one week. A total of 156, 813 applications had been received, of which 60, 349 loans valued at Rs351. 3 billion had been approved, while 9, 717 loans amounting to Rs51. 13 billion had already been disbursed. The meeting also reviewed progress under the Pakistan Accelerated Vehicle Electrification (PAVE) Programme. With 17 participating banks, the programme had recorded 17, 118 approved applications involving Rs2. 581 billion, while 4, 228 loans amounting to Rs804 million had been disbursed. A total of 1, 860 electric bikes had so far been delivered. The Finance Minister emphasised that the focus must now be on accelerating delivery of electric bikes to beneficiaries whose financing has already been approved and disbursed, so that financial approvals translate more quickly into tangible outcomes on the ground. Chief Executive Officer, SMEDA, briefed the Committee on initiatives being undertaken across three key work streams: the Financial Literacy Programme, SME Financing Help Desks, and Over-the-Counter Documents and Tools. The Committee was informed that 560 financial literacy training programmes are planned across Pakistan, of which around 100 have already been conducted. The Finance Minister appreciated the progress and emphasised the importance of assessing outcomes and incorporating feedback to continuously improve the effectiveness of these programmes. The Committee was also briefed on the SME Financing Help Desk initiative being implemented with partner banks, with five help desks conducted during the last month. The discussion covered digital tools, partnerships and communication channels to improve SME awareness and access to finance. The Finance Minister encouraged SMEDA to work closely with participating banks and leverage existing platforms and partnerships to scale up these initiatives, particularly to strengthen SME capacity, financial preparedness and ease of access to formal financing. Senator Muhammad Aurangzeb emphasised that expanding access to finance requires coordinated action across the financial ecosystem, alongside measures to improve the capacity and bankability of SMEs and other underserved segments. He highlighted the importance of practical support in areas such as financial management, documentation and cash-flow visibility to enable businesses to engage more effectively with formal financial institutions. The Finance Minister underscored that the access to finance framework should remain anchored in measurable progress, effective coordination and timely implementation. He directed that the relevant sub-committees continue to advance their respective work streams and bring key recommendations and implementation issues to the Steering Committee for timely consideration, supporting continued progress towards the objectives of the Prime Minister’s Access to Finance Plan. Copyright Business Recorder, 2026

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