Consumer financing propels banking sector.

Byline: KHALIL AHMED

Economic, technological, regulatory and social factors are worthy of backing Entrepreneurship, employment and support to the economy making an upturn Interview with Mr. Saad Hassan - Wing Head Management Audit, National Bank of Pakistan

PAGE: Tell me something about yourself, please:

Saad Hassan: I work at NBP as Wing Head, Management Audit. I have gotten working experience in the areas of Regulatory Compliance, Service Quality, Training and Development and Audit and Inspection.

I am an MBA from IBA coupled with a Master in Economics and a Master in Islamic Banking and Finance, besides an Associate of Institute of Bankers, Pakistan (IBP).

PAGE: In the Pakistani banking sector, the evolution of the consumer financing portfolio is a more recent phenomenon, as banks have traditionally focused on lending to the corporate sector and public sector entities. What is your take on it?

Saad Hassan: It is true that in the Pakistani banking sector, there has been a historical focus on lending to the corporate and public sector entities, and the evolution of the consumer financing portfolio is a more recent trend. This trend is not unique to Pakistan, as many other emerging economies have seen a similar shift in the banking sector. The reason behind this shift is the changing economic landscape, where the rising middle class and increased purchasing power of individuals have created a demand for consumer financing. Banks have recognized this demand and are now offering a range of consumer financing products, such as personal loans, credit cards, and auto loans, to cater to this growing market. The expansion of the consumer financing portfolio has not only benefited the banking sector but also the overall economy. It has helped increase consumer spending and has fueled the growth of various industries such as automotive, real estate, and retail.

However, it is worth noting that with the increase in consumer financing, there is also an increase in the risk associated with it. Banks must carefully manage this risk through proper credit risk management practices to ensure the sustainability of their lending activities. Overall, the evolution of the consumer financing portfolio in the Pakistani banking sector is a positive development that has helped fuel economic growth and provided individuals with greater access to financing.

PAGE: Which factors are responsible for the widespread popularity of consumer finance in Pakistan?

Saad...