There has been an announcement by the Asian Development Bank (ADB) that a loan of $155.5 million has been approved for Pakistan that will support women’s financial inclusion to boost their livelihoods while contributing significantly to the economy.
This loan will be used to assist in policy reforms aimed at improving women’s access to finance and providing credit to micro, small, and medium-sized enterprises headed by women, as stated by a statement issued by the Manila-based lender on Monday.
There has been a development in Pakistan in recent days after the Asian Development Bank approved a $658.8 million loan to support Pakistan’s sustainable growth and help it recover from last year’s cost-of-living crisis.
As part of the latest financing, the ADB announced that it would provide a $100 million policy-based loan in support of legal and regulatory reforms to enable women to better access financing; a $50 million financial intermediation loan that will enable participating financial institutions to lend to women entrepreneurs; and a $5.5 million grant to finance related activities.
It will be impossible to achieve inclusive, resilient, and sustainable development if women do not have equal economic opportunities and benefits,” said Yevgeniy Zhukov, ADB Director General for Central and West Asia.
“The new program of the Asian Development Bank will be instrumental in transforming Pakistan’s current financing ecosystem to facilitate the access of women to much-needed finance and empowering them to boost their livelihoods while contributing significantly to the country’s economic growth.”
An ADB statement stated that the female labor force participation rate in Pakistan currently stands at about 23% and that the country also has one of the lowest rates of women’s entrepreneurship in the world, with only 4% of female working-age adults being entrepreneurs.
According to the report, the financial inclusion of Pakistan has improved in recent years, but women are increasingly left behind due to a large gender finance gap that currently stands at 34%, the report said.
The ADB’s senior financial sector economist Andrew McCartney stated that there are many women entrepreneurs in Pakistan, but they remain unrecognised because their businesses are small and informal.
Policies must recognize the importance of women’s entrepreneurship and create an environment that provides more opportunities for women to participate in the formal economy and grow their businesses.
Women’s needs are incorporated into national policies through policy-based loans, such as the State Bank of Pakistan’s Banking on Equality Policy, which requires banks to establish departments devoted to women’s needs.
In addition, it supports measures that facilitate women’s access to credit and credit alternatives through online channels, provides financial training and advisory services to women, and improves the working conditions of women working in the finance industry.
In contrast, the financial intermediation loan is expected to benefit around two million women entrepreneurs, including approximately 510,000 who previously had no access to finance.
ADF’s grant will be used to fund activities such as the development of financial literacy programs and the development of a digital platform linking women with financial services.
+ There are no comments
Add yours