Global Findex 2017 mentions that only 21% of Pakistan’s population has access to accounts whereby 50% of people have access to accounts in Bangladesh, 80% in India, 15% in Afghanistan, 26% in Myanmar and 45% in Nepal. Further, based on estimates of Pakistan Micro Finance Network, the penetration rate of micro finance in the country, as of June 30, 2020 is around 33.6%. Another way of putting this is: There are 66.4% market yet to be served. This means that formal institutions like MFBs have a major role to play in increasing the financial inclusion.
In Pakistan, micro finance services are being provided by the Micro Finance Banks (MFBs) and then, there are certain Non-Banking Finance Companies (NBFC) and Rural Support Programmes (RSP) providing Micro finance services as well. The NBMFCs are licensed and regulated by the Securities and Exchange Commission of Pakistan (SECP) under special guidelines approved in 2016.
Numbers tell interesting story. This publication is an attempt to put together the information available for three years i.e. from 2017 to 2019 at one place to show case the progress being made by the MFBs in key indicators of borrowers, savers, profits, branches and employees. Figures of June 30, 2020 have also been cited (based on data available) to provide reader with an overview of performance in mid of COVID – 19 situation. Pakistan Micro Finance Network, a membership-based organizations of MFBs, NBFCs, MFIs and RSPs publishes micro finance sector review on an annual basis.
As of June 30, 2020, there are 11 dedicated Micro Finance Banks (MFBs) providing micro finance services in Pakistan. The MFBs are licensed and regulated by the State Bank of Pakistan under the Microfinance Institutions Ordinance 2001. MFBs are deposit taking entities governed under prudential regulations that are separate from those of commercial banks
This publication provides an overview of the key performance indicators of the micro finance banks in Pakistan from 2017 to June 30, 2020.
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SharJanuary 18, 2021
Saqib RazaJanuary 18, 2021
M. Tayyab KhanJanuary 19, 2021
Very crisp and precise presentation of different cuts on the industry. MFBs are creating difference in financial fabric of masses, yet at the same time industry is facing a difficulty to hold its upward repo due to decline of a MFB jiant. Thanks for putting up analysis.
Riasat zamanJanuary 20, 2021
Very interesting insight about MFBs and it shows that there is a potential of growth in the sector if the organization has a good startegy with better control inplace. Good effort on collecting and publishing the information
Farhat AbbasJanuary 22, 2021
Being a part of MFB.MFB will facing very certicaly condition in the shape of write off due to covid19 and crops issued.mostly people of village have no other sources to repayment due amount.25% people taking stay on their loan . Because there is no colleter against loan,just personal grantty.frud by employee increase day by day ,there for TMFB closed moslty branches in different areas.in the end of 2021 totally MFB will face a hugely loss