World Bank approves $102m for Pakistan’s financial inclusion
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The World Bank (WB) on Wednesday approved $102 million in financing for the Resilient and Accessible Microfinance (RAM) Project in Pakistan, which aims to enhance access to microcredit and support the resilience of the microfinance sector and its borrowers, particularly in the face of climate-related shocks.
World Bank Country Director for Pakistan Najy Benhassine said, “Microfinance is a critical tool for supporting the livelihoods of vulnerable populations in Pakistan. This project will help strengthen the resilience of the microfinance sector, particularly in the face of growing climate risks, ensuring that the sector can continue to provide essential financial services to those who need them most, especially in rural areas”
Najy Benhassine said that this project is part of our broader commitment to promoting financial inclusion in Pakistan and to increasing resilience to climate change, as spelled out in our new 10-year Country Partnership Framework.”
According to World Bank’s statement, the RAM Project is expected to benefit nearly 1.89 million people (including more than 1 million women and over 350,000 youth), especially those in vulnerable and low-income rural communities in Pakistan.
“By providing financial resources to microfinance institutions, the project ensures that they can continue to provide services even during climate-induced financial pressures. The project will provide increased access to microcredit for individuals and small businesses, providing them ‘recovery loans’ to help them gain financial stability.”
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The statement added, “The Resilient and Accessible Microfinance Project has been designed based on lessons learned from the devastating floods of 2022 and is a significant step to bolster financial inclusion in Pakistan,” said Namoos Zaheer, Task Team Leader for the Project. “It will enhance economic empowerment and resilience of those at the bottom of the economic pyramid, particularly women, small farmers, and families in rural areas who are more prone to climate shocks.”
The project will be implemented by the Ministry of Finance through the State Bank of Pakistan. It will be first in a series of interventions to support the sector, to be designed and phased in close partnership with other international financial institutions.
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