As of June 30, 2022, the Mera Pakistan Mera Ghar scheme has disbursed Rs. 100 billion, while applications totaling Rs. 500 billion had already been submitted, and Rs. 236 billion had been approved.
In the seventh episode of the SBP Podcast series, Executive Director Development Finance Group (DFG) Mr. Samar Hasnain made this claim.
He emphasized that the government has decided to adjust the features of the Mera Pakistan Mera Ghar (MPMG) scheme in view of the altered macroeconomic situation, and that the MPMG scheme has not been permanently suspended.
The Finance Minister noted that a committee has been established to examine the features of the Scheme and determine whether they need to be revised.
According to Samar Hasnain, the main causes for the alteration of the MPMG scheme were a change in the policy rate, a decline in the value of the dollar, and an increase of 16 percent in the Karachi Inter Bank Offered Rate (KIBOR).
He added that the government’s share of the subsidy, which was originally 7 percent, has increased to 15 percent. It became challenging for the government to absorb this subsidy because it was also starting up discussions with the IMF and implementing fiscal consolidation measures.
He stated that SBP developed score cards for persons with informal incomes while bringing attention to those working in the informal sector. In that case, all a person has to do is include their utility bills, mobile top-ups, and other receipts in the scorecard, and the banks will use a set formula to determine their score.
Banks determined the amount of credit that should be extended to the borrower based on that score and evaluated the borrower’s ability to repay.
Comparing mortgage financing in neighboring countries, he elaborated that it is ten to 20 percent in developing countries like Malaysia, and Indonesia. In developed countries, it is even more than 100 percent.
He regretted that in Pakistan, the mortgage financing to GDP ratio is less than 0.5 percent. He said the construction sector is connected with 40 allied industries. Hence, the housing sector is linked with economic growth.
