In Pakistan, the banking system was intermediating the savings of millions of depositors primarily to fund the fiscal deficit and the losses of the public sector, to meet the working capital of 200 top named companies and to engage in letters of credit for business and international trade. The number of active borrowers was limited to less than half a million at best.
By allowing the banking system to offer new products and services such as agriculture credit, SME financing, mortgage loans, automobile leasing, personal loans etc. a new vista has opened up. Commercial banks that were always hesitant to channel credit to agriculture sector are now the single most source of agriculture financing. This year almost 1 million households will receive about Rs.