KARACHI, Feb 20: Small enterprises and farmers received Rs2.83 billion in bank financing under Credit Guarantee Scheme (CGS) during the last 18 months, said State Bank on Wednesday.

The scheme has facilitated financing in 105 districts across the country with 85 per cent of loans provided to previously un-served and under-served clients in rural areas, of which 81 per cent were subsistence farmers.

Similarly, 91 per cent of the loans under the Scheme were provided to small businesses with less than five employees of whom 90 per cent were sole proprietors.

Under the CGS, banks also focused on serving the lower end of the commercial banking market through smaller loans, with an average loan size of Rs390,000 for agriculture and Rs2.1m for small enterprises. Based on client needs, the loan tenor under the CGS ranged from less than one year to three years.

The SBP said the scheme through its support is likely to further enhance economic opportunities and increase employment in the rural areas of the country.

The CGS is monitored by the Technical Committee drawing membership from the UK’s Department for International Development, SBP and the Pakistan Banks Association (PBA).

The Scheme introduced by SBP in 2010 with the financial assistance of DFID under the Financial Inclusion Programme and Government of Pakistan with the objective to increase the flow of financing to small and rural enterprises that have limited access to financial services from the formal financial system. The scheme has so far supported nine banks including big five banks.