SME strategies: banks asked to adopt non-financial advisory services

The State Bank of Pakistan (SBP) has advised the banks to adopt ''non-financial advisory services'' in their SME banking strategies and start providing non-financial advisory services to their existing and potential SME clients with immediate effect.
According to SBP, despite having large contribution in our national income, exports'' growth and employment generation, SMEs are constrained in their access to finance and other banking services. In view of their role in the economy, banks and DFIs need to adopt dedicated approach while targeting SMEs as their clients and go beyond providing financial services only.
SBP in a circular to banks said that in consideration of the fact that majority of the SMEs lack expertise to professionally manage financial, technological, marketing and human resource aspects of their businesses, banks should play supportive role in providing non-financial advisory services to their existing and potential SME clients.
Owing to their easy access and influence on SMEs through large branch networks and financial facilities, banks are well placed to foster financial viability and growth of SMEs by offering non-financial advisory services on business related matters to SMEs.
Therefore, in view of the foregoing, banks are advised to adopt ''non-financial advisory services'' in their SME banking strategies and start providing ''non-financial advisory services'' to their existing and potential SME clients with immediate effect, SBP said. SBP will continue to facilitate the process of implementation of ''non-financial advisory services'' through different supportive measures like arranging training programmes and conducting awareness sessions.