Please refer to IH&SMEFD Circular No. 05 dated March 29, 2022 on the captioned subject.

2. With a view to further facilitate SMEs access to finance, State Bank of Pakistan has increased clean lending limit to Rs 10 million for SMEs. Accordingly, Regulation SME R-4 of Prudential Regulations for SME Financing has been amended as under:
   
   SME R-4: Limit on Clean Facility
   “Banks & DFIs can take clean exposure (facilities extended based on cashflows of an SME secured solely against personal guarantees) of up to Rs 10 million on an SME borrower. It may be noted that the clean exposure limit shall not include the clean consumer financing limits (Credit Card and Personal Loans etc.) allowed to a sponsor of the said SME under Prudential Regulations for Consumer Financing”.
   
   
3. Banks and DFIs are advised to ensure circulation of above amendment among all their offices/ branches for meticulous compliance in letter and spirit. Non-compliance of Prudential Regulations will lead to punitive action under the relevant provisions of BCO, 1962.

Encl: Annexure-1: Updated Prudential Regulations for SME Financing