Missing lending targets: PM directs strict action against banks
ISLAMABAD: Prime Minister Shehbaz Sharif on Monday directed State Bank of Pakistan (SBP) and finance ministry to take strict action against banks failing to meet lending targets for priority sectors, including agriculture, small and medium-sized enterprises (SMEs) and housing.
Chairing a meeting to review measures to facilitate lending to priority sectors, the prime minister warned banks against delaying loans to farmers, small businesses and applicants under the ApnaGhar housing scheme.
He said banks that failed to support government initiatives must be held accountable, while those performing well in agricultural, housing and SME financing deserved recognition.
He emphasised that banks played a key role in promoting private-sector development and should extend the same level of cooperation to priority sectors as the government and its institutions provided to the banking industry.
According to a briefing at the meeting, agricultural lending had reached Rs1,329 billion, benefiting around 3.5 million people, while SME financing stood at Rs1,148 billion, with 342,458 businesses having secured loans.
Under the ApnaGhar programme, loans worth Rs511 billion had been approved against 86,899 applications as of October 23, 2026. Of the approved amount, Rs91 billion had been disbursed to 15,584 applicants.
The overall volume of housing finance had reached Rs455 billion, benefiting 187,317 borrowers, the meeting was informed.
The government has set a target of increasing lending to both the agricultural and SME sectors to Rs1,500 billion by the end of the financial year 2027.
Sharif said the development of agriculture, SMEs and housing was among the government’s foremost priorities, given these sectors’ potential to drive economic growth and generate employment, particularly for young people.
He said SMEs could play a significant role in strengthening the economy, boosting exports and creating jobs, while agriculture remained the backbone of the country’s economy.
The government, he added, was working to increase agricultural exports through value addition.
He said the ApnaGhar scheme would also give a boost to the housing and construction industries and generate wider economic activity.
Sharif directed Finance Minister Muhammad Aurangzeb to address financing constraints faced by stakeholders in the agricultural, SME and housing sectors and formulate a comprehensive strategy to resolve them.
He also directed SBP and Federal Board of Revenue (FBR) to coordinate in resolving tax-related issues confronting SMEs and exporters.
Calling for improved access to institutional financing, the prime minister directed the relevant authorities to develop a comprehensive risk-coverage mechanism to encourage banks to lend to small and medium-sized businesses.
The meeting was informed that the SBP was pursuing a three-pronged strategy to expand financing to priority sectors: improving regulatory arrangements, sharing risks and costs between the government and banks, and promoting digital financial services.
As part of these efforts, the SBP had recently launched the SMEConnect digital portal, enabling businesses to apply for loans and track the progress of their applications.
The government has also introduced risk-sharing arrangements and credit guarantees for the housing, agriculture and SME sectors.
Measures are being taken to simplify loan application procedures, reduce documentation requirements and improve access to financing through digital platforms.
The meeting also reviewed the performance of commercial banks against key lending indicators in the three priority sectors. The prime minister appreciated banks that had performed well in extending credit.
Federal ministers Muhammad Aurangzeb, Ahsan Iqbal, Rana Tanveer Hussain, Riaz Pirzada, Atta Tarar and Shaza Fatima, Adviser to the Prime Minister on Industries and Production Haroon Akhtar, State Minister for Finance Bilal Kayani, SBP Governor Jameel Ahmad, senior government officials, and heads and representatives of leading commercial banks attended the meeting.
Copyright Business Recorder, 2026