KARACHI: The State Bank of Pakistan (SBP) on Tuesday decided to impose a penalty on banks, which fail to comply with the disbursement targets assigned by it.

Through a Circular No 03 of 2021, the central bank informed the banks about the government’s markup subsidy scheme (G-MSS) for housing finance.

The SBP hoped that the banks were making all-out efforts to harness the full potential of the scheme. Accordingly, in April 2021, the central bank had assigned monthly mandatory targets of number of housing units and amount of disbursements (G-MSS targets) to the banks in proportion to share in the total banking assets.

In view of foregoing, it has been decided that the penalty will be imposed on banks falling short of their G-MSS targets from July 31, 2021 on both targets of number of housing units and the amount of disbursements.

A baseline penalty will be charged for the shortfall from cumulative targets till July 31, 2021, while a higher penalty will be charged on the shortfall from the targets of subsequent months, the SBP said.

The penalty charged on a bank will be adjusted after review of the bank’s efforts in terms of logins of applications, approvals of housing finance, results of SBP’s latest mystery shopping surveys, involvement of bank’s management, evidence of board information and support, sale and marketing efforts, innovation in delivery channels, capacity-building of staff and human resource (headcount) involved in G-MSS.

To assess the efforts, the State Bank of Pakistan will collect information from the banks, which fail to meet their targets.

Also Read

Pakistan’s imports from China grow 38.74% in 11 months: SBP

KARACHI: China remained the biggest exporter to Pakistan as the country imported...