KARACHI: The State Bank of Pakistan (SBP) on Tuesday amended the regulations and redefined that an entity above five years old will be treated as start-up under small and medium enterprises.
The SBP said that in order to align the definitions of small enterprise and medium enterprise with the SME definition prescribed in SME Policy 2021, notified by Government of Pakistan, following definition related regulations have been updated:
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An entity having annual Rs150 million turnover will be treated as small enterprises. Under this, a small enterprise up to five years old will be considered as start-up small enterprise.
An entity having annual Sales Turnover above Rs150 million to Rs800 million will be treated as medium enterprise. Under this, a medium enterprise up to five years old will be considered as start-up medium enterprise.
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The SBP said these amendments are applicable with immediate effect on new financing. However, since the banks/DFIs need to segregate their existing portfolio according to the revised definition of Small Enterprise and Medium Enterprise, they are allowed an implementation period upto June 30, 2022.
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Banks and DFIs are advised to ensure circulation of these regulations 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.
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