Blogs

On July 31^st, 2025, the SME Finance Forum convened global banking and development leaders for a high-level CEO Virtual Roundtable focused on advancing SME finance through innovation, inclusion, and leadership. The event showcased diverse strategies and impactful initiatives from institutions across Asia, Africa, Latin America, and the Caribbean. CEOs and senior executives shared insights on driving SME banking excellence, leveraging digital tools, fostering inclusive ecosystems, and preparing for an AI-driven future. This summary captures the key takeaways from the roundtable, highlighting actionable models and collaborative opportunities to finance positive change.

Driving SME Banking Excellence

Zafar Masud – Bank of Punjab (Pakistan)
Zafar highlighted Pakistan’s significant growth in SME financing, emphasizing the CEO’s role in structuring, monitoring, and collections. Digital tools, psychometric analysis, and AI were pivotal in scaling outreach and improving recovery rates.

• Achievements: Led a 41% increase in SME financing in Pakistan, contributing nearly one-third of the national growth.
• Strategy:
  • CEO’s Role: Central to structuring, monitoring, and collections.
  • Board Buy-in: Critical to overcome skepticism about SME creditworthiness.
  • Recovery Rate: Achieved 96% repayment success.
• Innovation:
  • Digital Lending: End-to-end digital onboarding using proxy data.
  • Psychometric Testing: Used for creditworthiness assessment.
  • AI Tools: Applied in credit scoring and collections.
• Impact Assessment: Used to identify target segments (e.g., women, specific regions) and reduce default rates.

Richard Sammy – Republic Bank (Caribbean)
Richard stressed the importance of segmenting SMEs from commercial portfolios, using data-driven approaches, and relaxing risk parameters.

• Context: Operates in 16 countries with diverse SME needs.
• Governance Shift: Segmented SMEs from commercial portfolios for focused support.
• Risk Management: Adjusted risk appetite to suit SME realities.
• Initiatives:
  • TT$20M MSME Fund: Oversubscribed and scaled up by 500%.
  • Sectoral Focus: Agriculture, hydroponics, poultry.
  • Non-Financial Support: Training, partnerships with universities and women’s groups.
  • Innovation Hub: Center for Business Innovation launched.

Karl Westvig (Time Bank) showcased how digital onboarding and revenue-based financing models can reduce acquisition costs and serve SMEs efficiently across geographies.
 

Role of the Development Sector

Manoj Mittal – SIDBI (India)
Manoj explained India’s multi-pronged approach to SME development, including financing, equity, and ecosystem building. SIDBI’s impact is measured through employment, exports, and innovation metrics.

• Institutional Role: SIDBI is a development financial institution, not a commercial bank.
• Scope: Supports MSMEs from microfinance to startups.
• Impact Metrics:
  • Employment: Tracked digitally.
  • Exports: District-level programs boosted exports by 9% CAGR.
  • Migration: Reduced rural-to-urban migration.
  • Innovation: Rise in startups and gig workers.
• Ecosystem Building:
  • Microfinance Transformation: NGOs to NBFCs.
  • Venture Capital & Fund of Funds: Long-term equity support.
  • Guarantee Programs: Over 10 million MSMEs served.
• Risk Mitigation: Strong governance, sovereign support, and skilled staff.

Said Jabrani – Tamwilcom (Morocco)
Said shared how guarantees and partnerships with microfinance institutions have reduced collateral requirements and increased SME lending.

• Mission: Improve access to finance for micro and small enterprises.
• Market Context:
  • 93% of private sector entities are micro-SMEs.
  • Yet, they contribute only 20% to GDP and 30% to exports.
• Programs:
  • Collateral Reduction: From 166% to 69% of loan value.
  • Loan Guarantees: For microfinance institutions.
  • Joint Lending: Co-financing with MFIs.
• Results:
  • SME loans rose from 23% to 41% of total private sector loans.
  • 20,000 beneficiaries annually, with plans to double.

Irene Arias Hofman – IDB Lab (Latin America & Caribbean)
Irene emphasized the need for SMEs to become data-ready and the role of platforms like Connect Americas in boosting exports. She advocated for enabling digital lenders and improving SME digital capacity.

• SME Contribution: 33% of GDP and 45% of formal employment.
• Challenges:
  • 74% struggle with data utilization.
  • 60% lack a data strategy.
• Solutions:
  • Connect Americas: Boosted SME exports by 17%.
  • Open Finance & Sandboxes: Enable digital lenders.
  • Data Economy Projects: Build SME digital readiness.

Innovation & New Market Segments

Irene Arias Hofman – IDB Lab (Latin America & Caribbean)
Irene discussed the importance of digital public infrastructure, open finance, and cross-border interoperability. She cited Nubank’s rapid SME lending growth as a model.

• Credit Gap: $5 trillion globally.
• Enablers:
  • Digital Public Infrastructure: Brazil’s PIX and India’s tech stack as models.
  • Interoperability: Crucial for cross-border solutions.
• Case Study: Nubank’s SME lending grew 5x faster than consumer lending.
• Caution: Ensure disruptors don’t become gatekeepers - ”disrupt the disruptors."

Karl Westvig – Time Bank (South Africa & Asia)
Karl explained how transactional data enables scalable, inclusive lending models across markets.

• Model: Digital-native bank with physical kiosks.
• Onboarding:
  • 3–5 minutes for full account setup.
  • $5 acquisition cost.
• Revenue-Based Finance:
  • Uses transaction data from partners.
  • $200M funded annually.
  • Expanded to Philippines, Indonesia, Vietnam.
• AI Integration:
  • Transactional and behavioral data used for credit scoring.
  • Preparing for AI-native banking competition.

Zafar Masud emphasized collaboration with tech partners and regulators to drive innovation and manage risk.
 

Serving the Underserved & Building Skills

Sitara Merchant – SCBF
Sitara advocated for bundling financial services with risk management and skill-building, especially for women-led SMEs.

• Bundled Services: Credit + insurance + training.
• Examples:
  • Evisa (Kenya): Satellite-triggered drought insurance.
  • Tunai (Indonesia): Embedded finance for agri-SMEs.
• Gender Lens:
  • Women-led SMEs often excluded despite reliability.
  • Advocates for gender-intentional product design.
• Skill Gaps:
  • Risk management, compliance, customer-centric design.
  • Responsible innovation and investment readiness.

Tram Anh Nguyen – CFTE
Tram Anh stressed the urgency of reinventing education systems to prepare SMEs for AI-driven transformation. She introduced frameworks like the AI Capacity Engine and CDE Innovation Prism.

• Mission: Future-proof financial professionals.
• Trends:
  • AI reshaping jobs and skills.
  • Need for system thinkers and supercharged professionals.
• Frameworks:
  • AI Capacity Engine: Personalized learning paths.
  • Performance Ladder: Tracks skill progression.
  • CDE Innovation Prism: Fosters innovation.
• Call to Action: Reinvent education systems and build AI fluency.

Forum’s Role & Speaker Recommendations

Speakers called for:

• Neutral Convener: Continue connecting DFIs, banks, fintechs, and gender-focused innovators.
• Knowledge Sharing: More practical case studies and thematic webinars (e.g., innovation, equity, skills).
• Matchmaking: Help members collaborate based on strengths and needs.
• Focus Areas:
  • Gender-inclusive finance.
  • AI readiness and digital transformation.
  • Equity financing and startup support.