Govt raises loan limit to Rs10 million for low-cost housing, cuts mark-up to 5%

The Economic Coordination Committee (ECC) of the Cabinet has approved revised features of the Mera Ghar Mera Aashiana (MGMA) low-cost housing finance scheme, increasing the maximum loan limit to Rs10 million and setting a uniform end-user mark-up rate of 5 percent.

The meeting, chaired by the finance minister at the Finance Division, considered a summary from the Ministry of Housing and Works seeking changes to the mortgage financing framework. The committee endorsed expansion of the eligible housing size to units up to 10 marlas or flats up to 1,500 square feet and approved a four-year target to support financing of around 500,000 housing units.

The mark-up rate, previously set at 8 percent, has been unified at 5 percent. The ECC also directed that loans already disbursed under the scheme be adjusted to the revised 5 percent rate to ensure uniformity. Implementation will continue through the State Bank of Pakistan (SBP).

The committee approved year-wise subsidy estimates linked to disbursement of 50,000 housing units by June 30, 2026. It emphasised that subsidy payments would be aligned with actual loan disbursements and accommodated within annual fiscal allocations.

According to SBP data shared with the ECC, banks have received 10,594 applications seeking Rs32.288 billion in financing. So far, 344 loans amounting to Rs810 million have been disbursed.

In separate decisions, the ECC approved a technical supplementary grant (TSG) of Rs7.289 million for the ICT component of the “National Program for Enhancing Command Areas in Barani Areas of Pakistan” to support agricultural productivity in rain-fed regions.