MICROCAPITAL BRIEF: State Bank of Pakistan (SBP) Reduces Provision Requirements for Microfinance Loans

The State Bank of Pakistan [SBP] has withdrawn general provision requirements for loans extended by microfinance banks [MFB] that are secured against collateral. In the words of a circular issued by SBP, “It has been decided to withdraw the general provision requirements wherein loans have been secured against gold or other cash collateral with appropriate margin.” The dispatch also establishes that for collateral-free loans the general provision requirement has been reduced to...

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