SME Banking

Small and medium enterprise (SME) sector are a priority amongst economic development goals, in both developed and emerging economies. SMEs are a primary driver for job creation and GDP growth. They contribute to economic diversification and social stability while playing an important role in private sector development.
SMEs require financial services for varied reasons. They lack the cash flow to make large investments, they cannot access capital markets as large firms can, and they often lack qualified staff to perform financial functions. Here, bank-provided long-term debt can enable SMEs to invest in expansion without losing ownership. In addition, short-term and working capital loans help SMEs grow incrementally. Lastly, bank deposit and transaction products can improve operational efficiency and enable SMEs to outsource financial functions.

Definition Of SMEs (Small & Medium Enterprises)

Small Enterprises

A Small Enterprise (SE) is a business entity which meets both the following parameters:

Number of Employees: Up to 50 (including contract employees)
Annual Sales Turnover: Up to Rs.150 million

A Small Enterprise can avail financing up to Rs 25 million from a single Bank/DFI or from all Banks/DFIs. At least 40% of the project’s/enterprise’s financing should come from the borrower in the form of equity. Up to 60% would be financed by HabibMetro Bank.

Medium Enterprises

Medium Enterprise (ME) is a business entity, ideally not a public limited company, which meets both the following parameters:

Number of Employees:
Manufacturing and Services 51-250 (including contract employees)
Trading 51-100 (including contract employees)

A Medium Enterprise (ME) can avail total financing (including leased assets) up to Rs.200 million from a single Bank/DFI or from all Banks/DFIs.  At least 40% of the project’s/enterprise’s financing should come from the borrower in the form of equity. Up to 60% would be financed by HabibMetro Bank.

Who can apply and for what purpose?

Sole proprietors, partnership firms and all other legal entities can apply for SME financing as per the below-mentioned criteria. This financing can be obtained for the purpose of setting up new business and/or expansion of existing business.

Available Financing Facilities (Conventional)

Local Working Capital Finance

  • Running Finance
  • Cash Finance
  • Local Documentary Bill Purchase
  • Trust Receipt
  • Local Purchase Order
  • Invoice Financing
  • Inland Bills Purchased
  • Commodity Finance.

Foreign Working Capital Finance (Import)

  • A.D
  • Trust Receipt
  • I.M.
  • FCY Loan against FE-25 (Import)

Foreign Working Capital Finance (Export)

  • Finance against Foreign Bills
  • FCY Loan against FE-25
  • Foreign Documentary Bills Purchased
  • Packing Credit
  • FCY Export Bills Purchased

Demand Working Capital Finance

Available Financing Facilities (Islamic)

Working Capital Finance

  • Murabaha Financing (Local Purchase)
  • Murabaha Finance Local (Under FE-25)
  • AL-Bai Finance
  • Istisna Financing
  • Salam

Import Financing

  •  Murabaha Financing PAD
  • Murabaha Finance – Import
  • Murabaha Finance Import – Under FE25

Long Term Finance

Long-term financing products, such as term loans with longer maturities and fewer restrictions on usage, provide SMEs with investment capital for strategic business expansion

Demand Finance for Fixed Assets

  • Finance Lease
  • Commercial Loan
  • Term Finance

Term Loan for Fixed Assets

Diminishing Musharika / Ijarah


Collateral / Security may vary from product to product. Some types of collateral/security commonly used are:

  • Mortgages (Urban property)
  • Hypothecation of plants & machinery/stocks
  • Pledge of Government Securities
  • Lien on Deposits/Term Certificates

Re-finance Facility

This financing is available to a wide range of SME Clusters / Sectors. Only SME borrowers are eligible to avail financing facilities under this scheme.

Financing is also available for purchase of new imported/local plant & machinery, for BMR of existing units and setting up of new SME units. Moreover, financing can also be availed for import/ local purchase of new generators up-to a maximum capacity of 500 KVA. The capacity of generator shall, however, not be in excess of SME Unit’s in-house energy requirements or up-to 500 KVA, whichever is less.

For more information or assistance with application, please visit a HabibMetro Branch/Sirat branch near you.

Application Process:

– Visit a designated HabibMetro Bank/Sirat branch near you and fill out an application form (available in both English and Urdu; our Credit Officers will be available to provide you with any required assistance
– Attach the following required documents with your application:

  • Complete business plan of the project/enterprise/profile
  • Attested Copy of Computerized National ID Card (CNIC)
  • Tax Returns
  • Document(s) of property offered as security
  • Audited accounts (if loan is more than 15 million) / Financials for last two years preferably
  • Valuation of stock, plant and machinery
  • Personal Guarantee(s)
  • Bank statement(s) of sponsor

– Once the applicant has provided the requested information along with attested documents, the process takes around 30 days after initial assessment and documentary evidence verification. Any delays are usually because of inadequate information provided by the borrower.

Prime Minister Youth Business Loan

The Prime Minister Youth Business Loan scheme is designed to assist the financial aspirations of educated youth (21 -45 years) looking to establish or extend business enterprises.  Loans of up to Rs. 2 million are available at a pricing of 6% and a tenor of 8 years.

For more information, please call our 24/7 customer care at 111-1-HABIB(42242) or visit a HabibMetro Bank/Sirat branch near you.

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