The government has directed banks and other financial institutions to expand lending to small businesses and make it easier for them to obtain loans.

Finance Minister Muhammad Aurangzeb chaired a meeting to review financing for Small and Medium Enterprises (SMEs) and discuss ways to increase the number of businesses receiving loans.

The meeting examined the volume of SME lending and the number of borrowers. Participants noted that although financing had improved, more small businesses needed to be brought into the formal banking system.

Aurangzeb stressed that commercial banks, microfinance banks and non-bank financial institutions should increase their outreach, particularly to smaller businesses and exporters.

New Portal to Help Small Businesses Get Loans

The meeting also reviewed the recently launched SME Connect portal, which allows small businesses to apply for loans directly and connect with banks.

The finance minister welcomed the initial response to the platform, noting that thousands of applicants had shown interest within days of its launch.

He called for further improvements to the portal and simpler procedures to help businesses access financing without unnecessary hurdles.

The meeting also discussed better use of dedicated financing limits for SMEs, particularly those seeking loans for export-related activities.

Aurangzeb stressed the need for closer coordination between banks and the Small and Medium Enterprises Development Authority (SMEDA) to help businesses build their capacity and meet lenders’ requirements.

He also directed relevant ministries to identify and address regulatory obstacles affecting SME financing.

The finance minister said improving access to credit should remain a priority, as small businesses can help expand economic activity, increase exports and bring more businesses into the formal economy.