KARACHI: Recording an unprecedented growth of 85%, banks’ outstanding credit for housing and construction increased by Rs163 billion, from Rs192 billion to Rs355 billion, during 2021, said a statement issued by the State Bank of Pakistan (SBP) on Thursday.
Within the housing and construction portfolio, disbursements under the Government Markup Subsidy scheme, also known as Mera Pakistan Mera Ghar (MPMG), increased by Rs38 billion. Financing to Housing and Construction and particularly under MPMG has witnessed impressive growth on the back of many enabling regulatory environments introduced after extensive consultation with stakeholders.
Further, SBP also advised the banks to increase their housing and construction finance portfolios to at least 5% of their domestic private sector advances till December 2021, introducing a set of incentives and penalties to ensure compliance.
The central bank said that financing under MPMG picked up momentum in 2021 as approvals for financing by banks grew from near zero to Rs117 billion in 2021.
The banks have received requests for financing of Rs276 billion from potential customers, which indicates that approvals and disbursements will keep growing in the coming months.
The statement further said that SBP has taken a number of steps to create an enabling regulatory environment for banks to increase the flow of financing to the housing sector.