Govt decides to revise Mera Pakistan Mera Ghar Scheme

The government has not permanently shelved the Mera Pakistan Mera Ghar scheme and has decided to revise its features in light of the altered macroeconomic environment.

Samar Hasnain, executive director of State Bank of Pakistan’s (SBP) Development Finance Group (DFG), stated this during the seventh episode of the SBP Podcast series.

Hasnain noted that the finance minister had established a committee comprised of SBP and Finance Division officials to examine and evaluate the scheme’s features.

Tips How to Start Real Estate Business In Pakistan 2022

Mera Pakistan Mera Ghar to kick start again by August 31

He anticipated that the revised scheme would be finished and released by August 31 this year after receiving government approval.

He disclosed that the mortgage financing rate in neighboring nations was 10%, while in other developing countries such as Malaysia and Indonesia, it was 20%. In developed nations, the ratio exceeded 100%.

He lamented, however, that Pakistan’s ratio of mortgage financing to GDP was less than 0.5%.

Hansain noted that the SBP had been working to increase the proportion of mortgage financing and that it had eliminated two fundamental obstacles the sector had previously faced.

He refuted the notion that the government suspended the MPMG program due to a shift in the political climate.

When MPMG was introduced, the Karachi Inter-Bank Offered Rate (Kibor) was 8%, and the margin for banks was 4%, as banks initially received funds at Kibor plus 4%, which was 12%.

In addition, the end-user received 5% financing, and the government provided a 7% subsidy. In recent months, both Kibor and the government subsidy increased by 15%.

The government temporarily suspended the program on June 30, 2022, to reevaluate its features and make it more targeted so that the benefits reach low- and middle-income households who cannot afford to purchase or build a home without access to subsidized financing.

The previous government of PTI had launched Mera Pakistan Mera Ghar (MPMG) scheme to provide housing units at affordable interest rates.

Therefore, common perception was that coalition government had shelved the scheme because PTI government had launched it.