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Business Recorder
6 days ago
- Business
- Business Recorder
Aurangzeb for financing facilities to small farmers in Pakistan
ISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb chaired a key meeting at the Finance Division on Tuesday to review the progress and receive an update from the Task Force on un-collateralised formal credit to smallholding farmers. The meeting brought together senior representatives from Pakistan's financial sector, including commercial banks, development finance institutions (DFIs), regulators, and subject matter experts from the development sector who constitute the core of the Task Force. It focused on the recommendations presented as part of the National Subsistence Farmers Support Initiative, aimed at unlocking un-collateralised financing for small-scale farmers through innovative, technology-based solutions. Senate Functional Committee meets: SBP, NBP present various plans to promote agri, aiding farmers The minister was briefed that these recommendations were developed following an in-depth diagnostic of the practical and systemic challenges faced by smallholder tenant farmers, with the objective of proposing a sustainable, scalable solution to support their inclusion in the formal financial system. The initiative seeks to revitalise Pakistan's rural economy and strengthen food security by enabling smallholders to access credit without traditional collateral barriers. The minister was also updated on proposals to support farmers through a holistic approach promoting sustainable agriculture and rural uplift, anchored in a technology-driven framework. The proposed scheme would employ an end-to-end digital process to ensure transparency, efficiency, and a seamless customer experience. Designed as a federal programme with nationwide coverage, the initiative aims to align provincial and national efforts to boost agricultural productivity, enhance food security, and contribute meaningfully to GDP growth through inclusive agri-development. A revised scorecard was presented by the Task Force with a greater emphasis on agronomic factors— raising the weightage of agronomy from 40 to 60 percent— while maintaining a 40 percent weight on financial indicators, thereby rebalancing priorities to better reflect the realities of smallholder farming. The prototype scheme, developed by the Ministry of Finance's Task Force on Access to Finance, calls for a multi-bank and microfinance institution (MFI) delivery model implemented through a unified methodology, ensuring wide outreach and operational standardisation across financial institutions. Senator Muhammad Aurangzeb welcomed the recommendations and emphasised the importance of making the entire process time-bound and action-oriented to achieve lasting impact. He also highlighted the critical need to develop a parallel, tech-supported model for the dairy and livestock segment, recognising that most smallholder farmers maintain herds but face difficulties in securing financing for livestock acquisition, maintenance, and dairy product marketing. Noting the dual economic and nutritional value of dairy for the rural population, the minister urged the Task Force to integrate crops and livestock under a unified financial framework. He stressed that the approach must keep the client experience at the centre, prioritising ease, inclusivity, and accessibility through a robust digital journey that delivers benefits across the agricultural landscape. Copyright Business Recorder, 2025
Business Recorder
6 days ago
- Business
- Business Recorder
Aurangzeb seeks roadmap for transition to a digital economy
ISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb chaired a high-level meeting on Tuesday at the Finance Division to discuss a host of measures for advancing Pakistan's transition to a digital and less cash-dependent economy. The meeting brought together senior representatives from Pakistan's financial sector, including commercial banks, development finance institutions (DFIs), regulators, and investment experts who form the core of the Committee established by the minister to craft forward-looking recommendations to support Pakistan's transition towards a digital and less cash-dependent economy. Participants engaged in a comprehensive discussion on a series of key proposals aimed at fostering greater adoption of digital payments across the country. The group reached consensus on a range of measures intended to expand access to digital financial services, encourage the use of digital transactions, and reduce reliance on cash in everyday economic activity. Among the core areas of agreement was the need to ensure that digital payment options are widely available and accessible across various sectors, including retail, services, and public sector transactions. The participants supported steps that would encourage broad-based interoperability, leveraging Raast instant payments system in particular, leading to improved consumer choice in using digital payments platforms. It was also agreed that creating a more level playing field between cash and digital transactions is essential, and that incentive structures should be rebalanced to make digital payments more attractive and cost-effective for both consumers and businesses. The importance of improving cost structures related to digital transaction infrastructure, including merchant acquisition and service provision, was highlighted as a priority to enable wider outreach, especially for small merchants and underserved communities. Finance Minister Senator Muhammad Aurangzeb welcomed the Committee's recommendations and emphasised that digitalisation is central to Pakistan's economic modernisation agenda. He noted that increasing the footprint of digital payments will significantly enhance financial transparency, promote inclusion, and improve efficiency in both public and private sector operations. The Minister stressed that moving toward a cashless economy is not simply a policy aspiration, but a practical necessity for long-term fiscal resilience, competitiveness, and inclusive growth. 'Digitalization is the foundation of a modern financial system. We must move with urgency and coordination to create a payments environment that is inclusive, interoperable, and focused on ease of use for every Pakistani citizen.' He also underscored the importance of leveraging technology to simplify financial access for individuals and businesses while ensuring policy alignment across stakeholders. The meeting concluded with a directive from the finance minister for the committee to prepare a detailed and time-bound roadmap for implementation of these initiatives, to be submitted to the Finance Division for further action and policy consideration. Copyright Business Recorder, 2025
Business Recorder
6 days ago
- Business
- Business Recorder
Aurangzeb for financing facilities to small farmers
ISLAMABAD: Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb chaired a key meeting at the Finance Division on Tuesday to review the progress and receive an update from the Task Force on un-collateralised formal credit to smallholding farmers. The meeting brought together senior representatives from Pakistan's financial sector, including commercial banks, development finance institutions (DFIs), regulators, and subject matter experts from the development sector who constitute the core of the Task Force. It focused on the recommendations presented as part of the National Subsistence Farmers Support Initiative, aimed at unlocking un-collateralised financing for small-scale farmers through innovative, technology-based solutions. Senate Functional Committee meets: SBP, NBP present various plans to promote agri, aiding farmers The minister was briefed that these recommendations were developed following an in-depth diagnostic of the practical and systemic challenges faced by smallholder tenant farmers, with the objective of proposing a sustainable, scalable solution to support their inclusion in the formal financial system. The initiative seeks to revitalise Pakistan's rural economy and strengthen food security by enabling smallholders to access credit without traditional collateral barriers. The minister was also updated on proposals to support farmers through a holistic approach promoting sustainable agriculture and rural uplift, anchored in a technology-driven framework. The proposed scheme would employ an end-to-end digital process to ensure transparency, efficiency, and a seamless customer experience. Designed as a federal programme with nationwide coverage, the initiative aims to align provincial and national efforts to boost agricultural productivity, enhance food security, and contribute meaningfully to GDP growth through inclusive agri-development. A revised scorecard was presented by the Task Force with a greater emphasis on agronomic factors— raising the weightage of agronomy from 40 to 60 percent— while maintaining a 40 percent weight on financial indicators, thereby rebalancing priorities to better reflect the realities of smallholder farming. The prototype scheme, developed by the Ministry of Finance's Task Force on Access to Finance, calls for a multi-bank and microfinance institution (MFI) delivery model implemented through a unified methodology, ensuring wide outreach and operational standardisation across financial institutions. Senator Muhammad Aurangzeb welcomed the recommendations and emphasised the importance of making the entire process time-bound and action-oriented to achieve lasting impact. He also highlighted the critical need to develop a parallel, tech-supported model for the dairy and livestock segment, recognising that most smallholder farmers maintain herds but face difficulties in securing financing for livestock acquisition, maintenance, and dairy product marketing. Noting the dual economic and nutritional value of dairy for the rural population, the minister urged the Task Force to integrate crops and livestock under a unified financial framework. He stressed that the approach must keep the client experience at the centre, prioritising ease, inclusivity, and accessibility through a robust digital journey that delivers benefits across the agricultural landscape. Copyright Business Recorder, 2025
Business Insider
15-05-2025
- Business
- Business Insider
Partnering with Africa's boldest businesses: TAG steps into the spotlight
TAG, an independent advisory and investment management firm, is making its presence known as a vital ally for Africa's small and medium-sized enterprises (SMEs) and Creatives. Focused on unlocking scalable growth across the continent, TAG works closely with entrepreneurs, investors, and ecosystem enablers to help African businesses thrive in complex markets. With deep expertise in financial strategy, investment readiness, and sustainable business development, TAG partners with high-potential SMEs & DFIs (Development Finance Institutions) to strengthen their operations, access capital, and scale confidently across borders. Working behind the scenes with emerging and high-impact ventures like The Plug, Azuwa Studios, Peninsular Manufacturing, Challenge Fund for Youth Employment, Ororo Waste Management, among others, TAG brings practical support to African businesses that are solving real problems and scaling with purpose. From the creative economy to agribusiness, tech, and consumer goods, TAG is committed to advancing a new generation of African-led ventures that are not only investment-worthy but also transformative for local economies. This commitment is particularly evident in its work with Africa's growing creative sector, a space where talent abounds but structural barriers persist. 'As advisory partners to Africa's SMEs and creatives, we believe creativity and entrepreneurship are powerful economic drivers,' said Fiyin Ogunlesi, Managing Principal at TAG. 'But too many still face barriers to funding, ownership, and sustainability. Our mission is to close those gaps through practical support, from investment readiness to CFO services and global partnerships, helping our clients turn potential into lasting impact. Recently, we launched our Nigeria-focused Afrobeats economy Report to spotlight the opportunities in the music industry and creative ecosystem as a whole. We are partnering with the next regional champions across verticals, making Africa more global and economically viable, one bold venture at a time. Pictured from left to right: Brenda Fashugba, Regional Director, Creative Economy at the British Council; Arese Ugwu, Founder of Azuwa Studios; Natascha Korvinus, Principal at Proparco; Olisa Adibua, Creative Industry Entrepreneur speaking at TAG's launch in April. The firm's approach is hands-on, providing services such as embedded CFOs, financial structuring, policy engagement, and ecosystem mapping to ensure that African businesses are not just surviving but scaling with strategy.
Business Recorder
08-05-2025
- Business
- Business Recorder
Pakistan's banking sector deserves a fairer narrative
In a country gripped by chronic revenue shortfalls and economic instability, one sector quietly shoulders more than its share — yet is frequently criticised. Pakistan's banking sector, the country's largest taxpayer and a critical source of fiscal stability, is often maligned rather than supported. This paradox demands re-examination —and a shift in mindset that continues to distort the public narrative. In 2024, the banking sector, comprising commercial banks, DFIs, and microfinance banks, contributed an astonishing Rs 1.6 trillion to the national exchequer. This includes Rs 856 billion in direct corporate and income taxes, Rs 63 billion in sales and excise duties, and over Rs 685 billion in withholding tax collected and paid. To put this into perspective, that's nearly five times more than what banks paid in 2021. Yet, despite this unmatched contribution, banks continue to face criticism, regulatory unpredictability, and the heaviest tax treatment among all sectors. 'The banking sector contributed Rs 644 billion in taxes in 2023 alone, and in a single day facilitated Rs 30 billion in government revenue. Yet, we are being taxed at rates nearly double other sectors. Taxation must be based on income, not balance sheet size or political expediency. We are partners in progress, not targets for fiscal patchwork.'— Zafar Masud, Chairman, Pakistan Banks Association Banks today pay an effective tax rate of 54 percent, compared to the standard 29 percent paid by most other industries. This disparity is not only disproportionate, it is counterproductive. When institutions that finance infrastructure, businesses, and public services are penalized for their efficiency, the broader economy suffers. Critics often accuse banks of prioritizing government securities over private sector lending. But this ignores Pakistan's underlying economic realities, a persistently wide fiscal deficit, underdeveloped capital markets, and a narrow, undocumented tax base. In FY24 alone, banks financed over 99 percent of the government's budget deficit, ensuring critical expenditures like defence, pensions, and social protection continued uninterrupted. This is not a diversion of resources; it is a stabilising lifeline. Banks are not turning away from the private sector. They are responding rationally to a high-risk environment, where legal enforcement is weak and formal documentation is scarce. Until structural reforms are achieved, sovereign lending remains the most prudent and often regulatorily encouraged option. 'With 54 percent of the banks' income directed to the government, it is only fair that we are treated as partners. Time and again, whenever the government has called upon the banking industry, we have always stepped up, a commitment we will proudly uphold in the best interest of Pakistan. As one of the most transparent sectors of the economy, we remain dedicated to contributing to Pakistan's progress and trust our efforts will be acknowledged.' — Atif Bajwa, Chairman, Pakistan Banking Summit Steering Committee Much of the criticism directed at banks is based on generalizations. The sector collectively employs over 200,000 people and is actively increasing gender diversity under the State Bank's inclusion mandate. While service delivery can always improve, to suggest banks are uniformly exploitative is inaccurate. Moreover, the banking sector is among the most heavily regulated, audited, and transparent in the economy. It is also among the most forward-looking supporting SMES, agri-finance, housing, and digital transformation, even in a volatile economic climate. 'Profitability should not be treated as a red flag; it is a prerequisite for financial resilience and national progress.' The broader issue is this, when a compliant and transparent sector like banking is disproportionately burdened with taxation while vast segments of the economy remain undocumented, the incentive structure becomes distorted. No society can progress when responsibility is concentrated on a few formal sectors while others remain unregulated and under-taxed. Pakistan's banking sector is not asking for applause—it is asking for fairness in taxation and recognition of its role as a partner in national development. It has delivered when it mattered most. A transparent, tax-compliant sector that supports public finance, SMEs, and digital transformation deserves policy consistency—not punitive treatment. It is time for policymakers and the public to do the same: anchor the debate in facts, and shift the conversation from blame to balance. Copyright Business Recorder, 2025
