SECP proposes raising small business and housing loan limit to PKR 5 million
Regulator also seeks higher income and turnover thresholds to expand access to finance for small businesses
The Securities and Exchange Commission of Pakistan (SECP) has proposed increasing the maximum loan size for microenterprise and housing finance to PKR 5 million, as part of amendments aimed at expanding access to credit through non-bank financial institutions.
The proposed amendments have been issued for stakeholder consultation and have not yet been finalized.
Under the proposals, the annual income threshold for borrowers eligible for microfinance loans would rise from PKR 1.2 million to PKR 1.5 million, potentially bringing more borrowers within the scope of microfinance.
The SECP has also proposed a significant expansion in the thresholds used to classify small and medium-sized businesses. The annual turnover limit for small businesses would increase from PKR 30 million to PKR 400 million, while the threshold for medium-sized businesses would rise from PKR 400 million to PKR 2 billion.
The regulator said the proposed SME thresholds are aligned with recent changes introduced by the State Bank of Pakistan.
The proposals come as regulators seek to broaden formal financing channels for smaller businesses and households. The SECP had previously raised the loan size limit for microenterprise and housing finance offered by non-bank microfinance companies from PKR 1.5 million to PKR 3 million under amendments to the lending framework.
If approved, the latest proposed increase to PKR 5 million would further expand the amount that eligible borrowers could access through regulated non-bank lenders.
The SECP's consultation process will allow stakeholders to submit feedback before the proposed amendments are finalized.
