Frequently Asked Question

What is SME Definition?

SMEDA SME Definition

Small & Medium Enterprises are defined as follows, as approved in SME Policy 2007

SME Definition
Enterprise Category Employment Size (a) Paid Up Capital (b) Annual Sales (c)
Small & Medium Enterprise (SME) Up to 250 Up to Rs. 25 Million Up to Rs. 250 Million

The Federal Government, in line with the economic development of Pakistan may, from time to time modify the eligibility criteria as it sees fit. All providers of services receiving funding from the Government may define more narrow scopes for specific targeting purposes.

For detailed information on SME Policy, kindly Download SME Policy 2007 Document


SME Definitions used by various institutions in Pakistan

Institution Small Medium
SME Bank Total Assets of Rs. 20 million Total Assets of Rs. 100 million
Federal Bureau of Statistics Less than 10 employees N/A
Punjab Small Industries Corporation Fixed investment. up to Rs. 20 million excluding land and building N/A
Punjab Industries Department Fixed assets with Rs. 10 million excluding cost of land
Sindh Industries Department Entity engaged in handicrafts or manufacturing of consumer or producer goods with fixed capital investment up to Rs.10 million including land & building
State Bank of Pakistan (SME Prudential Regulations) An entity , ideally not being a public limited company, which does not employee more than 250 persons ( manufacturing) and 50 persons (trade / services)   and also fulfills one of the following criteria:
(i) A trade / services concern with total assets at cost excluding land and buildings up to Rs 50 million.
(ii) A manufacturing concern with total assets at cost excluding land and building up to Rs 100 million.
(iii) Any concern (trade, services or manufacturing) with net sales not exceeding Rs 300 million as per latest financial statements.

SME Definitions in selected Asia Pacific Economic Cooperation (APEC) member countries
Enterprises exporting up to US$2.5 Million a year are considered Small by the State Bank of Pakistan

Country Sector Employment Other Measures
Australia Manufacturing Less than 100 employees  
Services Less than 20 employees  
Canada Manufacturing Less than 500 employees  
Services Less than 50 employees  
China Varies with Industry Usually less than 100 Employees  
Indonesia   Less than 100 employees  
Japan* Manufacturing Less than 300 employees ¥100 million assets
Wholesaling Less than 100 employees ¥30 million assets
Retailing-Services Less than 50 employees ¥10 million assets
Korea Manufacturing Less than 300 employees  
Services Less than 20 employees  
Malaysia Varies (for SMI) Less than 75 employees (Different for Bumiputra Enterprises) Less than RM 2.5 million
Philippines   Less than 200 employees P 40 million assets
Singapore Manufacturing   less than S$12 million fixed assets
Services   Less than 100 employees
USA   Less than 500 employees  

Source: Hall (1995); for Japan*, Witton (1999), SME Policy in Thailand: Vision and Challenges-
Ramon C. Sevilla and Kusol Soonthornthada

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