PACRA Maintains Entity Ratings of JWS Pakistan

JWS Pakistan (JWSP or "the Company") is a Non-Banking Microfinance Company regulated by the Securities & Exchange Commission of Pakistan (SECP) under Section 42 of the Companies Act, 2017, with the status of a "Company Limited by Guarantee." Since its inception in 2015, JWSP has steadily expanded its presence across the Upper and Central regions of Punjab, Pakistan’s largest province. Today, the company operates 111 branches across 24 districts. As a not-for-profit organization, JWSP is dedicated to community development, with a strong emphasis on women’s empowerment. By providing microloans to aspiring female entrepreneurs—who make up 99% of its borrower base—the company enables them to establish and grow small businesses, fostering economic independence and social progress. Previously, the sector's performance was negatively impacted by various macroeconomic challenges, including high inflation and elevated policy rates, which collectively eroded individuals' purchasing power. However, in the first half of FY25, the sector has shown signs of recovery, driven by declining inflation and borrowing rates, leading to improved consumer sentiment. This recovery is reflected in the sector’s Portfolio at Risk (PAR) > 30 days, which improved to 1.57% in 1HFY25, down from 2.8% in 1HFY24. The sector’s progress is also evident in JWSP’s Gross Loan Portfolio (GLP), which grew to PKR 6,423mln as of December 2024, compared to PKR 6,033mln in FY24. The Company’s active borrower base has reached ~176,544 borrowers. As a result, the company's markup income increased to PKR 2,859mln in FY24, up from PKR 2,138mln in FY23, contributing to a profit after tax of PKR 318mln in FY24, compared to PKR 281mln in FY23. The loan portfolio remains primarily concentrated in the enterprise segment, reflecting the company's strategic focus on business financing. Additionally, prudent receivables management and an efficient recovery process have helped maintain a stable infection ratio of ~1%, reinforcing the company's commitment to asset quality sustainability as a top priority. Additionally, opportunities for technological advancement remain, presenting a pathway for operational enhancement. The company relies on diverse sources of funding, predominantly, the PMIC. It has also strengthened its funding base during the last year by garnering funds from international sources which shall fuel growth in the future. The reduction in policy rates has facilitated more stable lending conditions, though prudent risk management remains essential to mitigate potential fluctuations in Non-Performing Loans (NPLs). JWSP's Board remains actively engaged in strategic decision-making and steering the company’s direction while adhering to best practices in corporate governance. Backed by a stable and experienced senior management team, the company operates with well-defined reporting structures as per a formalized organogram, ensuring effective oversight and a robust monitoring framework.
The ratings are dependent on the Institution's ability to sustain positive performance indicators amidst growth in business volumes. Further, ratings also incorporate vulnerability of the business due to limited geographical presence and a modest market share. The ratings will monitor expansion of the business and efficacy of its risk mitigation mechanism.

About the Entity
JWS Pakistan was incorporated in 2015 as a Public Company Limited by Guarantee under Section 42 of the Companies Ordinance, 1984 (now the Companies Act, 2017). It is also licensed by the SECP under the Non-Banking Finance Companies Rules, 2003. The overall control of the Institution vests with an eight-member Board of Directors. Ms. Sabiha Shaheen is the Chairperson of the Board. Mr. Qazi Shoaib Alam Farooqi is the CEO and founding member of the Institution, who brings with him a wealth of experience, of more than two decades in the industry.