According to the State Bank of Pakistan, there has been an increase in the construction financing sector of Pakistan. Outstanding loans for building construction has increased by 42% since last year. The growth is attributed to several government policies introduced during the COVID-19 crisis.
One of the reform areas was the imposition by the SBP on banks to increase their housing construction loan portfolio to at least 5% of the total loan portfolio by December 2021. In addition, according to Pakistan Economic Survey, the construction sector has received 3.4% (Rs 8.9 billion)of the total credit received by the industries.
In the year 2021, the total loans issued under construction financing amounted to Rs 32.2 billion. This figure includes the working capital and fixed investment loans provided by banks to the private sector for construction purposes. Moreover, the housing construction sector played a major in increasing the number of outstanding loans received by the construction sector.