KARACHI: The Union of Small and Medium Enterprises (Unisame) has urged Finance Minister Miftah Ismail to restructure and reinforce the SME Bank for the benefit of the underprivileged sector, a statement said on Saturday.

Unisame President Zulfikar Thaver said that it is in the best interest of the sector to restructure and reinforce the bank to make it a Small and Medium Enterprises (SME) specific bank since it has now been decided not to privatise it nor to merge it with the National Bank of Pakistan.

He said that the SME banks in Pakistan and in Malaysia were both established at almost the same time. The SME bank in Malaysia is doing exceedingly well but in Pakistan it remained neglected and in the hands of non-experts and in doldrums.

The idea and concept was to make it an SME specific bank which could comprehensively facilitate the sector but unfortunately it lacked the political will and also the expertise of SME financing experts, Thaver added.

The Unisame president said that this specific job calls for risk management and collateral management including warehousing, logistics and goods in transit and production financing in its scope.

However, now that it is decided to broaden its scope and radius and to make it a real SME specific bank, the State Bank of Pakistan (SBP) and the ministry of finance must coordinate to make it worthy of being labelled as an SME specific bank.

Either the government can inject more funds into it or allow the SME bank to offer shares to the public to raise capital itself, he said, adding that it is important to have SME expert bankers to run the management of the bank.

The Unisame Council members appreciated the establishment of the Exim bank in Pakistan and said that together with a strong SME bank, it will be a boon for the small to medium sized entrepreneurs.