Which microfinance bank is the most popular in Pakistan?

You'll be able to cover the following topics in this blog post:

  1. Which is the Best and most popular Microfinance Bank in Pakistan?
  2. What is Microfinance Banking?
  3. Which Microfinance Bank is leading in upcoming years?
  4. Is Microfinance Banks are really helpful for me or for my business?
  5. The popularity of Microfinance Banking in Pakistan.

Before going through all the details of the most popular microfinance bank in Pakistan, I would like to explain what microfinance actually is.

What really is microfinance and how does it work?

Individuals or groups that are unemployed or have poor incomes can benefit from microfinance, which is also known as microcredit. Microfinance is a sort of banking service that is provided to those who are unemployed or have low incomes who would otherwise have no access to financial services.

Financing Individuals by Microfinance Banks:

In addition to lending (microloans can range from $100 to $25,000), many banks that participate in the field of microfinance also provide additional services such as checking and savings accounts, as well as micro-insurance products, and some even provide financial and business education to those who are in need of it. The ultimate purpose of microfinance is to provide an opportunity for disadvantaged individuals to become self-sufficient in their lives.

The following are the most important aspects of microfinance banking, not only in Pakistan but worldwide:

According to the World Bank, it is estimated that more than 500 million people have profited from microfinance operations.
  • In the banking industry, microfinance is a service that is provided to unemployed or low-income individuals or groups that would otherwise have no other means of obtaining financial services.
  • Micro-financiers, like conventional lenders, levy interest on loans and require borrowers to adhere to certain repayment arrangements.
  • Uganda, Indonesia, Serbia, and Honduras are just a few of the developing countries where microfinance activities may be found in abundance.
  • Microfinance enables people to take out fair small business loans in a safe and secure environment while also operating in accordance with ethical lending principles.


Which microfinance bank is the most popular in Pakistan?


Let's have a look at Pakistan’s top most popular microfinance banks. In this blog post, I’ll talk about only the top 5 microfinance banks that are really popular in Pakistan;

Mobilink Microfinance Bank (JazzCash):

The Mobilink Microfinance Bank Limited (MMBL), part of mobile operator Jazz, has won the Best Microfinance Bank (Digital) of the Year Award from the CFA Society (Chartered Financial Analyst) in Pakistan.

Mobilink Microfinance Bank Ltd., also known as JazzCash, is Pakistan's largest digital bank, with more than 31 million registered members and 14 million active digital wallets each month, according to the company. MMBL stands for Mobilink Microfinance Bank Limited, a sister organisation of Jazz or JazzCash, and is backed by a worldwide telecommunication services company, VEON Ltd. MMBL is a significant participant in lending to small and medium-sized enterprises (SMEs).

EasyPaisa (Telenor Microfinance Bank):

The 2nd most popular microfinance bank in Pakistan, It was founded in collaboration between Telenor Group, the leading telecommunications company in Scandinavia and Asia, including Pakistan, with over 186+ million customers, and Ant Group, an associate of the Ali Baba Group that operates a digital standard platform known as AliPay. Telenor Microfinance Bank is a financial institution that provides loans to individuals and small businesses. In addition to a distribution network with over 150 thousand agents and points of contact throughout the country,

Finca Microfinance Bank:

Microfinance services are the Finca Bank's primary activity, which is, in accordance with the Microfinance Institutions Ordinance, 2001, provided to the underprivileged and neglected parts of society. For the duration of the year, effective November 25, 2013, the bank's name has been changed from Kashf Microfinance Bank Limited to FINCA Microfinance Bank Limited for the duration of the year.

Khushhali Microfinance Bank (Kushhali):

Khushhali Bank Limited, established in Islamabad, Pakistan, was the country's first microfinance institution. It was established in the year 2000. It was established with the assistance of the Asian Development Bank as part of the Pakistani government's poverty-reduction plan and as part of its poverty-reduction strategy.

The First Microfinance Bank Limited:

It was created in 2002 as a statewide microfinance bank with a licence from the State Bank of Pakistan, and it is now known as First Microfinance Bank Ltd (FMFB-P). The FMFB-P was established as a result of a structured transition of credit and savings from the Aga Khan Rural Support Program (AKRSP), a government-sponsored development programme that has been operating in the country since 1982 and has focused on the development of the microfinance sector in Gilgit-Baltistan and Chitral. A respected association with the purpose of eliminating poverty while also contributing to the social and economic well-being of society by offering opportunities to thousands of underprivileged communities, FMFB-P was established.


There are two more upcoming microfinance banks that are very popular among the youth of Pakistan. Let me introduce you to them;

SadaPay Microfinance Bank Pakistan (SadaPay):

When it comes to banking services in Pakistan, SadaPay (a microfinance bank) is a financial institution that offers financial services to unemployed people as well as freelancers, internet shoppers, and low-income individuals and groups who might otherwise be unable to afford them.

SadaPay is becoming increasingly popular among the younger population, and other microfinance institutions are becoming concerned about it. It has proven to be extremely beneficial for individuals and communities with little financial resources. I've written this essay to help individuals who are still debating whether or not to open a SadaPay account should do so.

In Pakistan, SadaPay is a startup microfinance company that has not yet been formally established or made available to the general public but is still providing services to a small number of customers.

In the words of SadaPay's tagline or motto, "Goodbye, Bank Fees," the company is saying goodbye to bank fees. They no longer charge fees for depositing money into an account, and they even provide three free withdrawals every month on top of that.

NayaPay Microfinance Bank of Pakistan:

All of your routine payments are made easier with NayaPay, the ultimate wallet. You can send money to friends and family members with NayaPay at any time for no charge. NayaPay is now publicly available for customers to use and is operational. However, in order to complete the sign-up procedure, you must first add yourself to a waitlist, which provides no indication of when your turn will come.

In terms of NayaPay Accounts, there are two types to choose from: 
  • Personal Account
  • Business Account

Personally, I dislike NayaPay since I have attempted to enrol myself on the platform for the past 1.5 years without success or even receiving a response from them, which is quite frustrating for me to say the least.


Conclusion:

There are numerous additional microfinance institutions in Pakistan that provide money management services right from their pockets and loans to individuals as well as small and medium-sized businesses for a variety of purposes. These financial institutions can provide you with loans and financial assistance for your business or even for personal problems.

As a result, given the wide range of features and perks available across microfinance institutions, it is quite difficult for me to name one as the best and most popular microfinance institution. However, as a freelancer in the IT industry, I personally prefer SadaPay because of its payment control features, which are useful whether you are making an online purchase or using your Master Card in person at a store or ATM. In your case, you might like another. At this point, I can only say "factors depend."

Related Blog(s):

A Quick Comparison: SadaPay Vs. NayaPay

Why SadaPay is being popular in microfinance banking in Pakistan?

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