Karachi, March 18, 2026 – The State Bank of Pakistan (SBP) on Wednesday released the weighted average lending and deposit rates for February 2026, showing a slight easing in borrowing costs and stable returns on deposits across the banking sector.
According to official data, the weighted average lending rate of scheduled banks stood at around 11.02% on gross disbursements during February, slightly lower compared to January’s revised figures. The data indicates a marginal decline in borrowing costs, reflecting easing financial conditions and improved liquidity in the banking system.
Meanwhile, the average deposit rate for scheduled banks remained relatively stable at approximately 5.04% during the month. This suggests that returns offered to depositors have largely remained unchanged despite minor fluctuations in lending rates.
The SBP data further shows that private sector banks continued to dominate lending activity with competitive rates, while public sector banks maintained slightly higher lending rates. Foreign banks, on the other hand, offered comparatively lower deposit returns.
Microfinance banks recorded significantly higher lending rates, exceeding 34%, reflecting the higher risk profile associated with micro-lending. Development Finance Institutions (DFIs) also maintained lending rates above 11%, indicating their continued role in financing long-term development projects.
On an overall basis, the weighted average lending rate for all financial institutions stood at around 11.22% in February 2026, while deposit rates averaged close to 5.08%.
Analysts believe the slight decline in lending rates may support credit uptake in the coming months, particularly if inflationary pressures continue to ease and monetary policy remains stable.