Pakistan Launches National Credit Guarantee Company to Boost SMEs

Pakistan has taken a Significant Step to Boost the Small and Medium-sized Enterprises (SMEs) Sector with the launch of the National Credit Guarantee Company Limited (NCGCL). This Credit Guarantee Company, a joint Venture between the Ministry of Finance and Karandaaz aims to Provide financial Support to SMEs in the Country.


The inauguration Ceremony attended by Representatives from the British High Commission Association of Chartered Certified Accountants (ACCP) State Bank of Pakistan and the Ministry of Finance marked the Beginning of a Transformative initiative. NCGCL will Focus on Enhancing Financial accessibility for SMEs through Special Credit Guarantee Facilities.


Minister for Finance Dr. Shamshad Emphasized the Significance of this Revolutionary Step Highlighting the low Private Credit for SMEs in Pakistan Standing at a mere 5.2 Percent. This figure has Declined from 7.7 Percent in the last five Years indicating the need for Measures to Boost SMEs’ Financial Reach.
SMEs Constitute 90 Percent of Formally Registered Businesses Contributing around 40 Percent to GDP and employ Approximately 80 Percent of Non-Agricultural Labor Forces in Pakistan. Dr. Shamshad Stressed that the Sector offers Opportunities for the low-income Strata and Plays a Crucial Role in Sustainable Growth and Development.

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The Launch of NCGCL is Seen as a far-Reaching institutional Reform Aimed at Facilitating Smoother Capital investment Paths for Small Businesses. Well-Designed and Effectively implemented Credit Guarantee Schemes have the Potential to Create financial additionality in the Market Translating into Economic Benefits such as Higher Productivity, innovation and Employment Generation.

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The Credit Guarantee Company will tailor Various Products for the Pakistani Market, Catering to over 1.5 million SMEs with a Market Volume Exceeding PKR 3.7 Trillion. Dr. Shamsad Akhtar Emphasized that Collaboration with financial institutions through NCGCL would Ensure Guaranteed access to Credit in the Market Fostering Economic Growth for Businesses. This initiative Reflects Pakistan’s Commitment to Supporting SMEs and driving Economic Development through improved Financial accessibility.