Govt to Punish Banks Delaying Loans to 3 Sectors - ProPakistani
Prime Minister Shehbaz Sharif has directed the State Bank of Pakistan (SBP) and the Finance Ministry to take action against banks that are slow to provide loans to farmers, small and medium enterprises (SMEs) and beneficiaries of the Prime Minister’s Apna Ghar housing scheme.
Chairing a review meeting in Islamabad on facilitating credit access to priority sectors, the prime minister said expanding financing for SMEs, housing and agriculture was a key government priority to improve the economy and create employment opportunities for young people.
He praised banks that had performed well in facilitating loans under government initiatives, while stressing that financial institutions must extend the same level of cooperation to priority sectors that they receive from the government and its institutions.
Shehbaz said SMEs had significant potential to support economic growth, boost exports and generate employment. He described agriculture as the backbone of the national economy and said the government was working to increase exports through value addition in agricultural commodities.
The prime minister also said the Apna Ghar scheme would support housing and construction while stimulating several industries linked to the sector. He emphasized that banks played a critical role in private sector development and should facilitate lending to priority sectors.
He directed the finance minister to resolve financing-related issues faced by stakeholders in the SME, agriculture and housing sectors and develop a comprehensive action plan. The SBP and Federal Board of Revenue (FBR) were also instructed to work together to address tax issues affecting SMEs and exporters, while developing a comprehensive risk coverage strategy to facilitate SME lending.
The meeting was informed that the SBP was working on three main pillars to increase lending to priority sectors: improving regulations, sharing risks and costs between the government and banks, and expanding digital facilities.
As part of these efforts, the SBP recently launched the SME Connect digital portal, which allows businesses to apply for loans and track the progress of their applications. The portal is available at [smeconnect.sbp.org.pk](https://smeconnect.sbp.org.pk).
The briefing also highlighted progress in priority lending for housing, agriculture and SMEs. As of October 23, 2026, loans worth Rs. 511 billion had been approved under the Prime Minister’s Apna Ghar Program, covering 86,899 applications. A total of Rs. 91 billion had been disbursed to 15,584 applicants.
The meeting was informed that the overall volume of housing finance had reached Rs. 455 billion, with 187,317 borrowers benefiting from loans.
Agricultural lending stood at Rs. 1,329 billion, benefiting approximately 3.5 million people. In the SME sector, financing reached Rs. 1,148 billion, with 342,458 businesses receiving loans.
Targets have been set to increase lending to both the agriculture and SME sectors to Rs. 1,500 billion by the end of fiscal year 2027.
The briefing also covered government initiatives involving risk-sharing and credit guarantees for housing, agriculture and SMEs. Efforts are underway to simplify lending procedures, reduce documentation requirements and improve access to financing through digital systems.
Performance indicators for commercial banks across all three priority sectors were presented at the meeting, with the prime minister praising banks that had demonstrated strong performance.
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