Credit to the housing and construction sector increased by Rs139 billion

Credit to the housing and construction sector increased by Rs139 billion. The work on promoting and facilitating housing and construction finance is advancing rapidly, and momentum is building due to recent government and State Bank of Pakistan measures (SBP).

The SBP noted in a statement on Tuesday that its housing and construction finance portfolio increased from Rs148 billion in late June 2020 to Rs202 billion in March 2021.

“This represents a growth of Rs54 billion or 36% in the first three-quarters of FY21, compared to a stagnant position in the preceding quarters,” the statement said. “Such rapid growth in housing and construction finance has never been seen in Pakistan’s history.”

It added that overall bank financing for housing and construction would increase further as ramped up mortgage finance activity under the “Mera Pakistan Mera Ghar” scheme.

As of April 20, 2021, banks had received applications from the general public for financing totalling more than Rs52 billion under the scheme, the SBP revealed. Banks have approved over Rs15 billion in funding for the applicants, with the remaining applications undergoing various stages of evaluation and approval.

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“The State Bank has worked closely with commercial banks to ensure that the ‘Mera Pakistan Mera Ghar’ housing finance scheme benefits the vast majority of the public,” it said.

To this end, the SBP, in collaboration with the Pakistan Banks’ Association (PBA), ensures that the application process for housing finance remains simple. “If applicants encounter difficulties or lodge complaints, will assist promptly,” it stated.

To begin, commercial banks have designated 50% of their branches across the country, or approximately 7,700, to accept applications under the “Mera Pakistan Mera Ghar” housing scheme.

Additionally, the remaining branches will provide essential information about the scheme and direct applicants to the designated branches.

“Banks are constantly advertising the scheme’s features to attract and encourage potential customers,” the statement stated. “To address complaints, the State Bank established a comprehensive complaint resolution mechanism that consists of an internet portal backed up by a network of State Bank and commercial bank employees.”

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