Islamic banks need to offer farm financing
STAFF REPORT KHI: State Bank of Pakistan (SBP) Governor Yaseen Anwar has said that Islamic banks need to offer agriculture financing to tap the huge productive potential of this sector.
“Its regrettable that Islamic banks have not been able to come out of the conventional shadow and lack better risk management and due diligence,” Anwar said during a two-day International Conference on Islamic Business organised by Riphah University.
He said that the agriculture sector and SMEs are of paramount importance for the growth but these are highly ignored, urging Islamic banks to tap huge opportunities available in the agriculture sector.
The agriculture sector is contributing 21 per cent to GDP and provides 40 per cent of the employment whereas Pakistan is the fifth milk producer in the world.
He said that huge opportunities exist for Islamic banks in agriculture sector and they must make efforts to tap these through agriculture financing.
“Inclusive growth is beneficial only and Islamic banks are required to be more aggressive and increase their outreach beyond major cities and deplored that 70 per cent of their branch network was confined to 12 major cities of the country,” he said.
He said that the SBP is working to provide Islamic interbank market to Islamic banks and regulator has been taking measures to help Islamic banking in Pakistan.