The purpose of the study was to explore the realities regarding low growth of the most important sector of the economy. During the study we remain focused on the three major areas including:  SME sector and its importance  Financing to SMEs  How helpful financing can be for the development of economy. A detailed working is done in this area in order to analyze small and medium sized enterprises value to the economy in terms of GDP share, employment generation, growth to the overall economy, percentage of SME financing in total portfolio of financial industry, issues in financing to SMEs, possible other factors affecting growth, initiatives taken up by governing and regulatory bodies to increase financing and lastly how financing to this sector can set the base for economic development.