World Bank Aims Supporting the Expansion of Mortgage Lending in Pakistan


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On Wednesday 27th September, National Bank of Pakistan’s President Saeed Ahmad met World Bank’s delegation along with Pakistan Mortgage Refinance Company (PMRC)’s representatives. In this meeting it was promised by the World Bank that they will support Pakistan’s home finance industry and funds for housing projects will be provided to help Pakistan meet its shortage of residential units that is approximately 10 million. These funds will be used towards helping Pakistan in its housing finance sector and for fulfilling its increasing demand for residential units will reach banks via PMRC.

Significance of Home Mortgage & Home Finance in Pakistan

The housing finance has potential to benefit residential development in a remarkable manner as country is in dire need of housing projects with low investments. The government has offered to facilitate this project by providing free of charge land. In case a house is built on this free of cost lands comprising of a room with attached bath, veranda and kitchen then the approximate cost will be Rs1.1-1.2 million as suggested by Mr. Ahmed.

The home mortgagae provided by World Bank will cater following for the development of financial sector of Pakistan:


  • Supporting the National housing policy and required capicity building

  • Supporting the conventional lending initiatives by local banks

  • Higher housing finance for catering the low-income sector

  • Providing technical assistance to the lending stakeholders


Helping Private Banks for Expanding their Lending Services:

Private Banks in Pakistan feel reluctant to provide home mortgage lending services due to following reasons:

  • Poor retrieval

  • Long-term engagement funds

  • Feeble foreclosure laws


Now as World Bank has offered to provide funds at 0.5-1 % private sectors will be able to increase and enhance their lending services. Mr Ahmed believes that these funds will encourage and facilitate financial sector in making its house portfolio reliable and money spinning in Pakistan.