State Bank of Pakistan (SBP) to go easy on banks while encouraging them to offer low financing cost and affordable housing for the citizens.
A statement from SBP read:
which is much lower than in other similar countries and in the region,
This is an important sector that has significant economic linkages with other sectors in the economy,
It is informed that the value of the housing unit has been increased from Rs. 3 million to Rs. 3.5 million while the loan size increased from Rs. 2.7 million to Rs. 3.15 million.
With the reforms, the banks will not only enjoy more markup subsidy facility on the credit but also the affordable housing finance incentives as well.
SBP has also allowed commercial banks a relaxation on documentary evidence from borrowers.
In order to facilitate financing for this segment, State Bank is urging the banks to use alternate methods to identify income sources and assess the creditworthiness of the borrower.
The source also added; SBP further is exempting commercial banks to skip the Internal Credit Risk Rating System till September 30, 2022.
It is reminded that banks have already been given mandatory targets of 5% of their private sector advances as housing and construction finance by December 31, 2021.