The State Bank of Pakistan (SBP) Refinance Loan Scheme is one of the most important financial initiatives designed to support businesses, SMEs, exporters, renewable energy projects, and other priority sectors of the economy. By offering loans at lower interest rates through commercial banks, the SBP helps businesses reduce their financing burden and promotes economic growth in Pakistan.
If you are an entrepreneur, exporter, SME owner, or want to invest in clean energy projects, then this scheme could be the right choice for you. In this guide, we’ll cover eligibility criteria, benefits, banks offering the scheme, and the step-by-step process to apply.
What is SBP Refinance Loan Scheme?
The SBP Refinance Scheme is a financing program introduced by the State Bank of Pakistan. Instead of directly lending money, the SBP provides funds to commercial banks at a reduced rate. These banks then forward loans to individuals and businesses at a lower markup than market rates.
This system makes financing more affordable for businesses and encourages growth in key economic sectors.
Key Features of the Scheme
| Feature | Details |
|---|---|
| Interest Rate (Markup) | Usually between 3% – 6%, depending on the scheme |
| Loan Amount | Varies by project, can range from PKR 1 million to PKR 1 billion+ |
| Tenure | 5 – 12 years (with grace periods in some schemes) |
| Available For | SMEs, exporters, renewable energy projects, women entrepreneurs, hospitals, IT sector, agriculture |
| Mode of Financing | Provided through commercial, Islamic, and development banks |
Types of SBP Refinance Schemes
The SBP offers multiple refinance schemes for different sectors:
- SBP Refinance Facility for Modernization of SMEs
- Export Finance Scheme (EFS)
- Renewable Energy Refinance Scheme
- Long Term Financing Facility (LTFF) for Plant & Machinery
- Refinance Scheme for Women Entrepreneurs
- Refinance Facility for Hospitals & Health Projects
👉 Each scheme has separate eligibility, markup rate, and tenure depending on the sector.
Eligibility Criteria
To qualify for an SBP Refinance Loan, applicants must meet the following conditions:
- Must be a registered business or company in Pakistan.
- Valid National Tax Number (NTN) and SECP/Chamber registration (for businesses).
- For exporters: Must show export orders/contracts.
- For renewable energy projects: Must provide project feasibility report.
- Good credit history with no default record.
- Collateral/security as per bank requirements.
Banks Offering the Scheme
Almost all major banks in Pakistan are authorized to offer SBP refinance loans. Some leading ones include:
- National Bank of Pakistan (NBP)
- Habib Bank Limited (HBL)
- United Bank Limited (UBL)
- MCB Bank Limited
- Bank Alfalah
- Allied Bank Limited (ABL)
- Meezan Bank (Islamic refinance options available)
- Askari Bank
- Faysal Bank
Documents Required
When applying for the scheme, prepare the following documents:
- CNIC of business owner(s)
- Business registration certificate / NTN
- Last 2–3 years audited financial statements
- Bank statements (6–12 months)
- Business feasibility plan
- Collateral/security documents
- Export orders (for exporters)
- Project details (for renewable energy/hospitals/IT projects)
Step-by-Step Application Process
- Identify Your Relevant Scheme
- Check whether you qualify under SME, Export, Renewable Energy, or Women Entrepreneur scheme.
- Select a Bank
- Choose from SBP’s approved banks that offer the refinance facility.
- Prepare Documents
- Gather CNIC, NTN, registration, feasibility plan, and other required documents.
- Submit Loan Application
- Apply through the commercial bank’s branch with your business case.
- Bank Review & Approval
- The bank evaluates your business feasibility, collateral, and credit history.
- SBP Refinance Approval
- Once approved, the bank applies for refinance funds from SBP.
- Loan Disbursement
- Funds are disbursed to your account for business/project use.
Benefits of Applying
- Lower Markup Rate compared to market loans.
- Encourages business expansion for SMEs and exporters.
- Long repayment tenure makes it easier to manage installments.
- Supports renewable energy projects, reducing electricity costs.
- Women entrepreneurs can access loans with special incentives.
Challenges & Limitations
While the scheme is beneficial, some challenges exist:
- Lengthy approval process (3–6 months in some cases).
- Strict documentation and collateral requirements.
- Limited awareness among small business owners.
- Banks may prefer large clients over small SMEs.
FAQs
1. Who can apply for SBP Refinance Loan?
👉 SMEs, exporters, renewable energy investors, hospitals, and women entrepreneurs can apply.
2. What is the interest rate of SBP Refinance Loan?
👉 Typically between 3% – 6%, depending on the scheme.
3. Can individuals apply or only businesses?
👉 Mostly businesses and registered entities are eligible. Some schemes (like Women Entrepreneur) allow individuals.
4. How long does it take to get approval?
👉 The process may take 2–6 months, depending on bank evaluation.
5. Is Islamic financing available under this scheme?
👉 Yes, Meezan Bank and other Islamic banks offer Shariah-compliant refinance loans.
Conclusion
The SBP Refinance Loan Scheme is a powerful financing option for businesses in Pakistan. Whether you’re an SME, exporter, or renewable energy investor, this scheme provides low-interest loans with flexible repayment options.
If you want to apply, the key is to prepare proper documentation, choose the right bank, and submit a solid business case. With the right approach, you can secure financing to grow your business and contribute to Pakistan’s economic development.
👉 Ready to expand your business? Start by contacting your nearest bank today and ask about the SBP Refinance Facility.