ASA International Group PLC has announced its 100%-owned Pakistan subsidiary’s approval to transform into a microfinance bank has been granted.
The emerging markets microfinance lender said the State Bank of Pakistan has issued a no-objection certificate to ASA Pakistan Ltd, allowing the unit to begin micro-lending operations within the next six months.
ASA International Chief Executive Dirk Brouwer said: “We consider this an important step towards securing the microfinance bank license, which should enable ASA Pakistan to mobilize savings over time.”
ASA International has established a non-depository Microfinance Institution namely ‘ASA Pakistan Limited’ and it is 100% subsidiary of ASA International. ASA Pakistan Ltd. is a public limited unlisted company registered with SECP.
It is engaged in the process of empowering the poor, who have no access to the traditional banking system for developing their business, the landless, the skilled laborers and marginal farmers for the improvement of their socio-economic condition.
ASA International Group PLC itself operates as a micro-financing company. The Company provides loans and advances to female micro-entrepreneurs and businesses. ASA International Group serves clients worldwide.
Pakistan Micro-finance Sector
It is worth mentioning that in the last two decades, the microfinance sector in Pakistan has grown from 60,000 to 7.3 million borrowers and is now offering a diversified menu of products other than traditional credit. Pakistan Microfinance Network has set a target to reach 10 million borrowers by the end of 2020.
SBP has played a very important role in the development of the microfinance and financial inclusion space in the country. The expansion of the microfinance sector is persistent regardless of the recent correction in the sector.
The microfinance players are moving away from the brick and mortar approach to digital financial services. The use of m-wallets and digital credits can deliver the volumes and expansion in outreach in a cheaper and convenient manner.