ISLAMABAD: The Pakistan Microfinance Investment Company (PMIC), a private-sector firm which aims to use public funding to invest commercially in people and businesses on lower incomes, was launched on Thursday by Finance Minister Ishaq Dar.
The PMIC has been created by the Pakistan Poverty Alleviation Fund (PPAF) and Karandaaz Pakistan — funded by UK’s Department for International Development (DFID) — and the KfW, a German government-owned development bank.
Microfinance is central to Pakistan’s National Financial Inclusion Strategy, launched in May 2015. The PMIC aims to help create a new supply chain for microfinance services. At present, 4.2 million Pakistanis are accessing microfinance services out of an estimated potential market of 20.5m.
The investment company also targets expanding microfinance to those low-income people who would otherwise have no access to banking and other financial services. The financing made in this regard will go through micro-entrepreneurs and micro-enterprises, and help drive business expansion, create jobs and spur economic growth.
Speaking on the occasion, PMIC Chairman Zubyr Soomro said the company was first of its kind as it was a market-based wholesale funding institution for microfinance at national level. “We look for it to lead financial inclusion to encompass affordable housing, livelihoods, energy and education finance,” he said. “This is an opportunity for significant growth in access to finance in Pakistan.”
British High Commissioner Thomas Drew said that “enterprising people from across communities in Pakistan are being held back by not being able to get access to finance — which they would use to increase their income and build their businesses”.
German Ambassador Ina Lepel also spoke on the occasion. “Microfinance is an important catalyst for business, employment and jobs. Germany is glad to have joined forces with our partners in order to foster the business potential of the people of Pakistan, especially the youth, through better access to finance.”