KARACHI: The State Bank of Pakistan (SBP) on Friday (January 21) directed all commercial banks to increase the housing and building finance to at least 7% of their total lending till December 2022, news sources reported. The target is a revised upwards from 5% for the same period last year.
In a notification released, the central bank urged the banks to increase housing loans for the residential and non-residential applicants. It was also revealed that, as a result of the increased bank targets, home loan disbursement increased by 85% to PKR 355 billion in 2021, up from PKR 195 billion in 2020. Similarly, three banks made the largest one-month distribution in December 2021, totalling PKR 90 billion. All of these loans were made available under the government’s flagship subsidised housing finance initiative Mera Pakistan Mera Ghar programme (MPMG). Similarly, the SBP has recommended banks to create official income estimating procedures and formulae in order to better manage and access loan capabilities for applicants. In the same vein, the SBP has encouraged banks to impose the following criteria adjustments to facilitate housing loans that include:
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