Empowering Small and Medium Enterprises (SMEs) has been recognized as a cornerstone for Pakistan’s socio-economic progress, with access to microfinance playing a defining role in enabling that transformation. Reaffirming this commitment, Mobilink Microfinance Bank Limited (MMBL) has signed a Memorandum of Understanding (MoU) with the Small and Medium Enterprises Development Authority (SMEDA) to strengthen the financial and developmental ecosystem for micro and small businesses across the country.
At the signing ceremony, Haaris Mahmood Chaudhary, President and CEO of MMBL, emphasized that empowering small enterprises is essential for Pakistan’s sustainable economic future. He noted that expanding access to finance for entrepreneurs, particularly those in underserved and rural areas, is key to creating a more resilient economy. According to him, inclusion at the grassroots level can propel widespread prosperity and drive long-term national growth.
Pakistan’s micro, small, and medium enterprises (MSMEs) contribute nearly 40 percent to the country’s GDP and employ a substantial portion of the labor force. However, they continue to face a significant financing gap. Despite their economic importance, MSMEs account for less than six percent of total private sector credit. Of the 7.1 million MSMEs currently operating in the country, most remain excluded from the formal financial system, especially those located outside major urban centers.
The newly signed MoU between MMBL and SMEDA aims to address this financing gap by extending government-backed financial schemes and development initiatives directly to micro and small businesses. The collaboration will enable both institutions to jointly provide loans, technical assistance, and business development services to entrepreneurs operating in rural and semi-urban areas.
Microfinance, which has become a cornerstone of financial inclusion in Pakistan, continues to play a pivotal role in reaching the underserved. Chaudhary highlighted that the microfinance sector has facilitated more than half of all new bank accounts opened in the last five years, serving around 10 million borrowers—more than twice the reach of conventional banking. This growth has proven the capacity of microfinance institutions to extend financial services to the grassroots level, enabling small enterprises and households to participate in the formal economy.
As of June 2025, Pakistan’s microfinance portfolio stands at over Rs 650 billion, with microfinance banks contributing more than 71 percent of this total. A notable trend is the inclusion of women entrepreneurs, who represent approximately 35 percent of borrowers. This underscores the sector’s growing contribution toward gender-inclusive economic participation and empowerment.
According to Chaudhary, MMBL’s strategy has focused on creating inclusive and accessible products that respond to the realities of small businesses rather than corporate finance models. “We’ve developed a network that combines digital platforms and relationship managers to reach entrepreneurs in areas where traditional banks do not operate,” he said. “Our loan structures are tailored to how small businesses earn and sustain revenue, ensuring flexibility and practicality.”
The partnership with SMEDA reflects a coordinated effort to integrate policy support, financing mechanisms, and capacity-building initiatives into a unified framework. By aligning these elements, the collaboration seeks to address systemic challenges such as limited access to credit, inadequate business skills, and lack of market linkages that often constrain SME growth.
This agreement also builds upon SMEDA’s ongoing partnerships with institutions like the Pakistan Microfinance Network and Akhuwat, reflecting a broader movement toward creating an inclusive and resilient business ecosystem. Through these collaborations, both public and private sector stakeholders aim to empower entrepreneurs, enhance productivity, and generate employment opportunities across the country.
With MMBL’s technological infrastructure and SMEDA’s developmental mandate, the partnership is expected to play a crucial role in strengthening Pakistan’s SME sector and promoting financial inclusion. It symbolizes a strategic shift toward collaboration and innovation, ensuring that economic progress reaches every layer of society.
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