Only 11.11% Loan Amount Used for House Loans

The State Bank of Pakistan (SBP) was dissatisfied with the reports on Wednesday. A staggering 200bn Rupee's loan application was received for low-cost housing in Pakistan, however, only a minimal amount of Rs18 bn was disbursed.

The low-cost houses were launched with the “Mera Ghar Mera Pakistan” scheme by the current government to help middle- and lower-class-income groups by providing them with better house finance possibilities.

The bank loans were harsh, with their peaking and frustrating interest rates. This made it difficult to acquire house loans in Pakistan. You can read the past development for house finance loans in the below article.

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The banking Industry

The banking industry was told to support the housing schemes, making the application procedures easier to access and make help the people get their houses with as much leverage as possible. 

The bank industry is no doubt doing an excellent job helping the housing and real estate sector but the speed of application approval is low and sluggish. This resulted in slow disbursement of finance, which would ultimately ‘Discourage people’. 

SBP Governor, Raza Bakar appreciated the progress made by the banking industry, however, their process speed was criticized.  

The Data

As per the data collected by SBP, as much as Rs 200Bn house loans were applied for. Only Rs 78Bn were approved by the banks, and only Rs 18Bn were handed out to the designated persons. 

The number provides valuable insight that as many as Rs78 Bn loan amount was still left to be handed out which shows how slow the procedure is. The Rs 200Bn ratio Rs78 Bn helps to understand that as much the procedure is cumbersome, slow as the disbursement, and lastly discouraging.

According to the State Bank of Pakistan governor, he expressed that:

“With the combined efforts of all stakeholders, the dream of Pakistanis to have their own homes can become a reality.