KARACHI: Habib Bank would soon start Small Business Finance to help support small & medium enterprises (SME) in the country, said Mubashir Maqbool, Head of Retail and Commercial Banking.He said this in a meeting with businessmen at the Karachi Chamber of Commerce and Industry (KCCI) on Thursday. Although the banking sector of Pakistan is facing tough times, HBL is trying to reach small businessmen through its countrywide network of 1,450 branches, he said, adding HBL also has one of the largest networks of branches in the world with 55 branches in 25 countries. Replying to a question about quality services, Mubashir said HBL has transformed since its privatisation in 2004 and is now trying to provide better services to its customers.

Head of Global Operations, Mudassir H Khan, said HBL is also focusing on Russia and Central Asia and is planning to introduce more services in these regions. Replying to a question, he said HBL deals on case-to-case basis for its services to Iranian banks that have been cleared by the State Bank of Pakistan (SBP). "Since, everything is market driven, HBL will increase its services to these regions as its customers grow," he added. KCCI President Anjum Nisar said local banks in Pakistan should improve their services to SMEs so that small businessmen can expand their businesses and help the national economy grow.

He said in Switzerland, the contribution of SMEs is 99 per cent and in Germany it is 92 per cent, these figures manifest the role of SMEs in developed economies. He cited the example of Malaysia which has increased its exports to $200 billion over a short period of time while copying some of the models of Pakistan. "Pakistan has got massive potential to progress and improve its exports like Malaysia," he added. SMEs in Pakistan can transform the face of industrialization in Pakistan if the government supports them by making consistent policies for small and medium enterprises, he claimed.

He also urged SBP to cut bench mark interest rates by 200 to 300 basis points so that industry could get some relief. He added cost of doing business in the country is increasing continuously, whereas the government's policy to control inflation through high interest rates has failed. A small trader asked HBL officials that if interest of banks is as high as 15 to 20 per cent, how can small traders, who generally earn 3 to 5 per cent profits, deal with the bank. Traders and businessmen said growth of small and medium enterprises is growth of the economy and is one of the best options available to increase the pace of industrialization in Pakistan. They also said that the people of Pakistan are waiting for a bank that replicates the successful microfinance model of Bangladesh.