Karachi: The State Bank of Pakistan (SBP) issued a circular on Tuesday requesting that banks boost their home loan disbursement and application targets under the Government’s Mark-up Subsidy Scheme (G-MSS), popularly known as Mera Pakistan Mera Ghar, news sources reported.
Read:SBP allows Banks to invest more capital in real estate Banks that fail to meet their application and loan disbursement targets after July 31, 2021, will risk a penalty, according to the circular. The decision was made in response to the slow allocation of housing funds to developers and the failure of banks to raise their credit portfolio up to 5% for housing and construction – as specified by the SBP in the July 15, 2020, circular.
Banks will risk fines under the new rules if they fail to satisfy their monthly targets. However, the banks that fail to meet their cumulative targets until July 31, 2021, will be charged with a baseline penalty. The SBP authorities will examine and assess the bank’s performance on key metrics in order to adjust the bank penalty. In that case, the stated indicators are as follows:
Previously, in June 2021, the SBP issued circular instructing banks to develop their own income estimation methods in order to serve common citizens with non-formal sources of income. The circular was released as a result of banks’ slow delivery of housing loans for low-cost housing projects.
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