Zahir Sakhi, Country Director of Accelerate Prosperity, has said that financing decisions that depend mainly on collateral leave many talented women and young entrepreneurs without the chance to show what they can achieve. He was speaking at the two-day international conference on inclusive and resilient growth organised by Pakistan Poverty Alleviation Fund in Islamabad, where he pointed to a gap between entrepreneurial potential and access to capital as a major barrier to inclusive economic growth. The remarks came as Pakistan marked the United Nations International Day for the Eradication of Poverty on 17 October.
The problem he described is common for small businesses in Pakistan. Banks usually ask for property or other assets as security before they lend, and women and young founders often have neither land nor a long credit history, so they are turned away even when their businesses are viable. Many then rely on informal loans or family savings, which limits how fast they can grow. Accelerate Prosperity works to close this gap by helping entrepreneurs build stronger businesses, become investment-ready and connect with the financing they need to grow.
The conference was held on 13 and 14 October at the Serena Hotel under the theme From Poverty to Prosperity, and it brought together more than 1,000 participants and delegates from 12 countries. It was organised by the poverty alleviation fund in collaboration with the Ministry of Poverty Alleviation and Social Safety, Paigham-e-Pakistan and the Centre of Excellence for National Cohesion and Outreach, and its sessions covered poverty graduation, small business development, youth economic participation and financial inclusion. It ended with a declaration calling for a national policy on poverty graduation.
Accelerate Prosperity, part of the Aga Khan Development Network, has been testing a different model in practice. This month, it announced that Bioniks and asani.io had become the first two Sindh-based businesses to receive financing under its collaboration with Sindh Enterprise Development Fund, in which the programme prepares businesses for formal finance and the fund provides a markup subsidy that lowers the cost of borrowing. The model shows how support before lending and a lower interest cost can substitute in part for the collateral that small enterprises often lack.
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