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$50m micro-credit fund for survivors: Ishrat
LAHORE, Nov 12 : Governor State Bank of Pakistan Dr Ishrat Hussain said that SBP has directed Khushali Bank for creating a fund of $50 million to provide micro-credit to the earthquake survivors.
He said that micro-financing would play a pivotal role in the rehabilitation of the earthquake survivors.
In an interview, he said that micro-financing would help reducing poverty, and containing widening economic inequality and this mode of financing was the dire need of the earthquake victims.
He said that the earthquake survivors needed financial support to resume their businesses. He pointed out that in the earthquake-devastated areas the livestock was the main source of income of the people that had been destroyed in the history’s most tragic quakes.
Dr Ishrat said that the linkage between financial sector and economic growth was well understood but that carried its impact on poverty reduction, which still was nebulous.
He said that there was a strong correlation between poverty and rehabilitation, which needed a concurrent form of transformation in strategic long-term molding. He said that the channeling of credit to the poor and lower classes had to be achieved through market-based financial system.
Governor State Bank said that 345 new branches of commercial banks had been opened in last one year. He said that state bank had been given the target of the bank for opening their branches in every district following the saturated services being provided in the cities. He said that medium-level banks like Union Bank, Askari Commercial Bank, Faysal Bank and Bank Alfalah are rapidly expanding their network of branches and enhancing their market shares. He said that due to expansion of the chain of branches of these banks, the market share of big banks of declining in the country.
Over 210 branches of commercial banks in the earthquake affected areas of Azad Kashmir and NWFP have been made functional due to the concerted efforts of the State Bank and the concerned banks’ management.
About 230 branches of seven commercial banks including the National Bank of Pakistan, Habib Bank Limited, United Bank Limited, Allied Bank Limited, MCB Bank, Bank of Khyber and the Bank of Punjab were operating in the districts of Muzaffarabad, Rawalakot, Bagh, Mansehra & Abbottabad when the earthquake struck these districts.