Karachi: The State Bank of Pakistan (SBP) has revised Prudential Regulations for Microfinance Banks (MFBs) to promote financing for low-cost housing and Micro & Small Enterprises (MSE), according to a news story published on Thursday (March 17).
As per the details, the revised regulations include risk management to ensure prudent housing and microenterprise financing, additional guidance for property assessment, and mortgage creation. Another amendment in the regulations was creating separate requirements for classification/provisioning and charging of non-performing loans for each category. Also, definitions of important terms have been provided for clarity and effective compliance.
Moreover, these changes are expected to decrease the cost of serving low-income borrowers by encouraging them to draw finance for MSE and low-cost housing. It is expected to improve the reach of MFBs to the underprivileged segment of society. It is pertinent to note that MFBs have a vital role to play in providing financial services to the low-income groups.
Iqra holds BS in International Relations and is passionate about writing engaging content on trending real estate topics. When not working, she is either spending time with family, shopping, or discussing shows & movies.
