KARACHI: State Bank of Pakistan (SBP) on Wednesday said housing and construction finance increased Rs139 billion or 84 percent year-on-year to Rs305 billion at the end of September 2021, owing to improved borrower-friendly procedures.
“Increase in credit to housing and construction sector reflects banks have realigned their internal policy dimension/ strategic focus towards development of housing and construction,” the SBP said in a statement.
“The banks have, in recent months, revamped their systems and procedures, upgraded and streamlined technological platforms, and motivated their banking staff through incentives and trainings,” it added.
As per the latest numbers of October 18, 2021, banks have received applications of more than Rs200 billion under the government’s flagship markup subsidy scheme, commonly known as Mera Pakistan Mera Ghar (MPMG). The banks have approved financing of Rs78 billion out of which Rs18 billion have already been disbursed under the scheme.
Governor, SBP Dr Reza Baqir stressed the need to accelerate the pace of approvals by banks to match the requests for financing to ensure that people were not discouraged by the processing time.
He expressed the hope that with the combined efforts of all stakeholders, the dream of Pakistanis to own homes could become a reality.
While appreciating the efforts to date, Baqir also asked stakeholders to increase outreach of the MPMG to the wider public. He said that when the journey of MPMG started last year, low-cost housing finance was almost non-existent as commercial banks rarely ventured in this area fearing its inherent risks. However, the strong commitment of government especially NAPHDA, SBP, banks, and other stakeholders to promote housing and construction activities in the country is beginning to result in considerable increase in finance for housing and construction.
The banks have also established a joint call center to address queries of general public regarding MPMG. This call center will help resolve complaints and assist common persons who would like to borrow under MPMG but face difficulties in completing the requirements of banks. Earlier, State Bank launched a user-friendly online complaint resolution mechanism in January 2021. The mechanism comprises an IT-based portal supported by a comprehensive network of State Bank and commercial bank staff to take care of problems faced by applicants and resolves complaints within a predefined timeline with proper escalation mechanism.
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