The Mera Pakistan Mera Ghar (MPMG) housing scheme received an astounding response during a two-day event in Faisalabad, where banks granted conditional approvals for housing loans totaling approximately Rs7.4 billion.
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Bank Alfalah tops in house financing under MPMG
KARACHI: Bank Alfalah has secured the top position in house financing under the government’s flagship Mera Pakistan Mera Ghar (MPMG).
According to a statement issued by the State Bank of Pakistan (SBP), Bank Alfalah secured the top position followed by Meezan Bank Limited and Standard Chartered Bank Limited.
A ceremony was held on Friday at Prime Minister House, Islamabad to mark Rs 100 billion in home finance approvals of the Governments flagship Mera Pakistan Mera Ghar (MPMG) program under the theme “ Khawab ke tabeer ab tez ter”.
READ MORE: Financing for Mera Pakistan Mera Ghar gains momentum
The Prime Minister lauded the leading role of the State Bank of Pakistan and the efforts of the banking industry in the implementation of MPMG. He also witnessed ceremonial keys being handed over to six beneficiaries of MPMG who were from different regions and represented a variety of segments of Pakistan.
Over 20 other beneficiaries of MPMG also participated in the ceremony. The Prime Minister expressed his pleasure to see that low and middle-income citizens who were completely ignored earlier are now being served by the banks in obtaining home finance. While distributing awards among top-performing banks with respect to approvals and disbursements, he urged banks to accelerate their efforts to help realize the dream of every Pakistani to own their own homes.
The ceremony was attended by Ali Amin Gandhapur-Federal Minister for Kashmir Affairs & Gilgit Baltistan, Dr. Shahbaz Gill-Special Assistant to Prime Minister on Political Communication, Senator Shaukuat Tareen-Adviser to Prime Minister on Finance & Revenue, Governor State Bank of Pakistan, Chairman NAPHDA, Dr. Amjad Ali-Minister for Housing Khyber Pakhtunkhwa and Presidents/CEOs of banks.
READ MORE: SBP launches webpage for promoting house financing
Dr. Reza Baqir, Governor State Bank of Pakistan, shared the progress of MPMG since inception, highlighting that all stakeholders are taking steps in the right direction to translate the Prime Minister’s vision of increasing homeownership into reality. Till December 20, 2021, banks have received applications of Rs. 263 billion while approvals of Rs. 109 billion have already been made. Over the last nine months, the approved amount increased by Rs. 98 billion. Disbursement has also increased from almost zero in March 2021 to Rs. 32 billion by December 20, 2021. While shedding light on the theme of the event, he mentioned that during the last month, banks on average approved Rs. 4 billion and disbursed Rs. 1.6 billion on weekly basis. He underscored the need to maintain and accelerate this momentum. There are six banks that disbursed over Rs. 2 billion each and seven banks have disbursed over Rs. 1 billion each in the span of 9 months under MPMG.
The Governor said that growth in MPMG is attributed to various measures taken by the Government, SBP, and NAPHDA to provide a conducive environment for the banking industry to enter the untapped market of housing and construction finance. He mentioned the simplification of complex procedures, a significant reduction in documentation requirement, development of a model to assess informal income, effective redressal mechanism as examples of this support. Communication initiatives like Mera Pakistan Mera Ghar Meri Kahani –a series of testimonials of MPMG beneficiaries have also been instrumental in encouraging others to apply.
READ MORE: PM launches house financing scheme for NRPs
Earlier, in a meeting of the National Coordination Committee on Housing, Construction, and Development (NCCHCD), Governor SBP apprised the Prime Minister on developments in housing and construction finance. He recalled that in July 2020, in line with the Government’s vision of boosting economic activity, SBP mandated banks to increase their housing and construction finance to at least 5 percent of their domestic private sector advances by December 31, 2021. Five banks have already achieved their December 2021 targets. The best performing banks in this regard were Albaraka Bank followed by Meezan Bank and Dubai Islamic Bank. He highlighted that as of December 17, 2021, banks have lent Rs. 321 billion which is Rs. 173 billion more than their financing as of June 30, 2020, reflecting a growth of 117 percent since June 2020. He praised Bank Al Habib, National Bank, and Bank Alfalah for a significant increase in their housing and construction finance portfolio since June 2020 till date.
In conclusion, Governor Baqir expressed SBPs confidence that the banking industry will continue to pace up its performance rapidly to meet the objectives of Mera Pakistan Mera Ghar and to reach targets mandated for Housing and Construction Finance.
READ MORE: Meezan Bank becomes pioneer in Sharia financing for low cost housing
The MPMG event also witnessed speeches from Senator Shaukat Tareen, Adviser to Prime Minister on Finance & Revenue, and Lt Gen Anwar Ali Hyder, Chairman NAPHDA. The Finance Adviser reiterated the Government commitment to MPMG and assured banks to provide all needed support. Chairman NAPHA requested banks to demonstrate commitment in providing housing finance to individuals in NAPHDAs LDA City and Peri Urban projects.
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Housing loan disbursement surges 84% by September
KARACHI: Housing and construction loan disbursement by banks has reached Rs305 billion by the end of September 2021, which was Rs166 billion at the end of September last year, showing an increase of Rs139 billion and a year-on-year growth of 84 per cent, the State Bank of Pakistan (SBP) said on Wednesday.
The banks have also received applications worth Rs200 billion for low-cost housing financing under Mera Pakistan Mera Ghar (MPMG) scheme.
The SBP said that as per the latest numbers of October 18, 2021, banks have received applications of more than Rs200 billion. The banks have approved financing of Rs78 billion out of which Rs18 billion have already been disbursed.
SBP Governor Dr. Reza Baqir appreciated the progress made by the banking industry in supporting low-cost housing finance for first time homeowners under the Mera Pakistan Mera Ghar.
At the same time, the Governor stressed the need to accelerate the pace of approvals by banks to match the requests for financing to ensure that people are not discouraged by the processing time. He expressed the hope that with the combined efforts of all stakeholders, the dream of Pakistanis to have their own homes can become a reality.
While appreciating the efforts to date, Governor Baqir also asked stakeholders to increase the outreach of the Government’s Markup Subsidy Scheme for Housing Finance commonly known as Mera Pakistan MeraGhar (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 the government especially NAPHDA, SBP, banks, and other stakeholders to promote housing and construction activities in the country is beginning to result in a considerable increase in finance for housing and construction.
To augment this effort the SBP provided an enabling regulatory environment to promote housing & construction finance.
In July 2020, State Bank of Pakistan advised commercial banks to increase their lending for housing and construction sectors to at least 5 percent of their private domestic sector advances by December 2021.
To assist in this, the State Bank advised quarterly targets to each bank after individual consultation, leading to the concerted effort. The focus on this segment increased and for the quarter ending September 30, 2021, banks have achieved 94 percent of their assigned targets on a consolidated basis. During July-September 2021, banks increased their credit to the housing and construction sector by Rs48 billion from Rs257 billion as of June 30, 2021.
An increase in credit to the housing and construction sector reflects that banks have realigned their internal policy dimension/ strategic focus towards the development of housing and construction. The banks have, in recent months, revamped their systems and procedures, upgraded and streamlined technological platforms, and motivated their banking staff through incentives and training.
The banks have also established a joint call center to address queries of the general public regarding MPMG which was recently inaugurated by the Governor SBP. The general public can reach the call center at 0-33-77-786-786. 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 complaint resolution 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.
Some of the other steps taken by SBP in collaboration with NAPHDA, other government agencies, banks and stakeholders include a simplified loan application, standard facility offer letter, amendment in the prudential framework, development of standard risk assessment criteria for builders/developers, development of income proxy model and streamlined financing documents.
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SBP launches webpage for promoting house financing
KARACHI: The State Bank of Pakistan (SBP) on Friday launched a webpage for the promotion of house financing in the country, especially for Mera Pakistan Mera Ghar (MPMG).
A statement said that the central bank had launched dedicated landing webpage on promoting housing and construction finance on its website.
The page contains extensive information on housing and construction finance and Mera Pakistan Mera Ghar (MPMG), Government’s flagship markup subsidy scheme for affordable and low cost housing finance.
The webpage provides information on various measures taken by SBP to promote housing and construction finance such as issuance of separate Prudential Regulations for housing finance, establishment of a high level Steering Committee, allocation of mandatory targets for housing and construction finance, incentives & penalties and market facilitation.
Moreover, a dedicated webpage for MPMG is also available to facilitate the potential applicants who intend to avail housing finance under MPMG.
The MPMG page covers information about the scheme comprehensively including eligibility criteria, tenor of the loan, maximum amount of loan, markup rates to be charged, maximum list of documents required and subsidy being provided by the Government. Through this page, potential applicants can also access websites of participating banks directly wherein loan application forms under various categories are available.
An installment repayment schedule of the loans and an instalment calculator are also available on this webpage.
The webpage also shares monthly data of housing and construction finance extended by the banks. Progress made under MPMG in terms of the latest statistics including data of amount applied, approved and disbursed under MPMG on monthly basis is also available on MPMG webpage.
Visitors will also be able to view the testimonials of the actual borrowers who have availed subsidized housing finance under MPMG by visiting the website. It is expected that this dedicated webpage will facilitate the visitors by providing them actionable information, guidance, and support they require for easy access to financing under MPMG.