Today, Karandaaz Pakistan and Meezan Bank signed the Corporate Vendor and Distributor Finance Program agreement, a first-of-its-kind initiative aimed at providing growth capital for small businesses. Through this agreement, up to PKR 9 Billion in program-based term funding for capital investment and expansion working capital will be made available to small and mid-size vendors and distributors operating in organized economic supply chains in Pakistan.The program has been developed in response to the sharp decline in SME finance in Pakistan,from ~17% of total commercial bank lending in FY2008-9 to ~6% by FY2014-15. Access to term funding (long term cap-ex financing) is even more scarce for SMEs in Pakistan. “It is critical for broad based economic and employment growth in Pakistan that this credit contraction is reversed and brought in line with comparable international benchmarks (20-30% of banking assets). It is also crucial for commercial banks to develop viable credit models to lend to this vital agent of the economy”, stated Mr. Asad Azfar, Chief Investment Officer of Karandaaz Pakistan, while providing an overview of the Corporate Vendor and Distributor Finance Program at the ceremony. “The partnership with Meezan Bank is a first step in this direction and will enable Apex Corporate to direct credit to vendors and distributors that are well-positioned for growth without assuming credit risk”, he added. Mr. Ariful Islam, Deputy CEO &Executive Director of Meezan Bank, expressed the Bank’s utmost commitment to this partnership with Karandaaz Pakistan. He stated, ‘I am both delighted and humbled by the fact that Meezan Bank has been chosen by Karandaaz Pakistan, a company that is principally sponsored by United Kingdom Department for International Development (UKAid) and Bill & Melinda Gates Foundation, to partner with it to provide finance to the Small & Medium Sized sector of the economy. We are committed to promoting this very important segment of the economy and our role is to provide risk capital and infrastructure to implement the Program successfully.’ The program has the potential to generate important strategic value for participating corporates by strengthening supply chains and distribution channels throughproviding access to finance; generating efficiency through greater economies of scale in supply chains and distribution channels; increasing corporate value by facilitating access to finance and banking relationships and reducing corporate balance sheet exposure. Meezan Bank, true to its commitment towards maintaining healthy bilateral relationships with majority of corporate customers in Pakistan, has not only proposed to broaden the vista of this program through the addition of distributors but has also recruited dedicated resources to ensure smooth operations and management of the program. Through this tripartite deal, Meezan Bank aims to contribute towards SME financing in Pakistan and addressing to cater the growing void in cash flow lending for this sector. The keynote address was delivered by Dr. Ishrat Husain, Chairman of the Board of Directors at Karandaaz Pakistan. While addressing the audience, he said, “Pakistan’s economy is highly dependable on the pace and productivity of SMEs. Ensuring access to finance by SMEs will allow them to modernize their production techniques, hire skilled human resources and invest in new equipment. They will be able to reposition themselves to earn more profits and expand their businesses. Furthermore, since SMEs are labor intensive and provide large scale employment, the rise in productivity and efficiency will make a significant contribution in accelerating employment generation, GDP growth and poverty reduction.” The United Kingdom’s Department for International Development (DFID) also stressed its commitment to financial inclusion in Pakistan. “Enhancing SME lending will make it easier for individuals including women and youth to expand their businesses and create more employment opportunities,” said Mr. Waqas ul Hasan, Senior Private Sector Development Adviser at DFID Pakistan. Speaking at the occasion, Louise Walker, Head of DFID’s Economic Growth Groupsaid, “We strongly believe that the obstacles preventing businesses from growing and creating jobs need to be tackled urgently. I am therefore delighted that Meezan Bank and Karandaaz Pakistan have embarked on this important venture and look forward to seeing the outcomes of this partnership.” About Karandaaz Pakistan Karandaaz Pakistan (ww.karandaaz.com.pk), a private company established in August 2014, promotes access to finance for small businesses through a commercially directed investment platform, and financial inclusion for individuals by employing technology enabled digital solutions. The Company has financial and institutional support from leading international development finance institutions; principally the United Kingdom’s Department for International Development (DFID) and the Bill & Melinda Gates Foundation. The Consultative Group to Assist the Poor (CGAP), a member of the World Bank Group, managed the start-up phase of the Company and continues to provide technical support. The Company has three work streams, Digital Financial Services, Corporate Investment and Credit and Knowledge Management and Communications.The Corporate Investment and Credit line of business of Karandaaz provides wholesale structured credit and equity-linked direct growth capital investments in small and mid-size enterprises with compelling prospects for sustainable growth and employment generation in Pakistan.Karandaaz Pakistan is sponsored and governed by eminent Pakistanis, and is managed by an experienced team with core expertise in international investment management and digital finance.