Staff Reporter
Islamabad
In an effort to facilitate the masses, the State Bank of Pakistan on Monday announced the government’s markup subsidy for affordable housing finance.
In a statement, SBP said that this facility will allow all individuals, who will be constructing or buying a new house for the first time, to avail bank’s financing at subsidized and affordable markup rates.
This facility will be provided with the administrative support of State Bank as executing partner with the government and Naya Pakistan Housing and Development Authority (NAPHDA), read the statement.
The government has allocated Rs 33 billion for payment of markup subsidy for financing over a period of 10 years and has assured continuity of the facility. For this purpose, SBP and the government have signed a memorandum of understanding.
The markup subsidy facility will be available through all the banks in three tiers. Financing under tier-I is available for the purchase of houses,apartments and flats of up to 5 marla, with a maximum price of Rs 3.5 million, under NAPHDA projects. Maximum financing under this tier is Rs 2.7 million with a maximum tenor of up to 20 years.
Banks will charge a maximum markup rate of KIBOR plus 250 basis points. However, GOP will provide a markup subsidy to reduce borrowers’ rate to 5 per cent for the first five years and 7 per cent for the next five years.
