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World Bank approves $223m package to modernize Karachi, help access financial services

World Bank approves $223m package to modernize Karachi, help access financial services

WASHINGTON: The World Bank has approved a package of $223 million to help millions of poor, especially women, have access to financial services, and improve living conditions in parts of Karachi.

The package includes $137 million the Financial Inclusion and Infrastructure Project to help provide financial access to poor and $86 million, and $86 million for Karachi Neighborhood Improvement Project that will benefit about one million Karachites living in the areas of Saddar, Korangi and Malir, a World Bank press release said.

Both credits are financed by the International Development Association, the World Bank’s fund for the poor, with a maturity of 25 years, including a grace period of 5 years. “The two new projects have a strong element of inclusion that is at the heart of the World Bank’s partnership with Pakistan, especially where women, youth and the poor are concerned,” said Illango Patchamuthu, World Bank Country Director for Pakistan.

“Five percent of the world’s unbanked population live in Pakistan. We need to change this to empower people financially, especially women. Karachi contributes about 15 percent of the country’s economy and the World Bank’s support will improve public spaces, mobility, and safety for its citizens.”

The Financial Inclusion Infrastructure Project will help those people who do not have bank accounts and cannot get loans. It will also upgrade Pakistan’s payment systems to ensure affordable and faster payment services.

“Our goal is to provide transparent and accessible financial services including micro and small loans to individuals and firms, particularly women and women-owned businesses in Pakistan,” said Gabi George Afram, the project’s Task Team Leader.

“We will be working closely with the Central Directorate of National Savings to provide more efficient and convenient access to financial services to 7 million clients through computerization of their financial systems,” he said. The project aims to improve access to financial and banking sectors for throughout Pakistan by 2020.

The Karachi Neighborhood Improvement Project will help improve the safety, accessibility, and attractiveness of public spaces in Karachi, such as streets, parks, city squares and pedestrian areas. It will ensure equal access to all including women, youth and the poor.

The project will also make it easier for the public and investors to access services such as construction permits and business registrations. “This project represents the start of a long-term partnership between the city of Karachi and the World Bank Group and will help strengthen confidence in the city’s administration among residents,” said Jaafar Friaa, the project’s Task Team Leader. “A systematic engagement with citizens will ensure that investments in public spaces are responsive to the local context, and build community ownership of the project.”

This project will support the setting up of a multi-member Steering Committee that includes the local government, civil society and private sector. It will guide the development of the city by laying out a vision.