PM orders action against banks slow to lend to SMEs, farmers

Prime Minister Shehbaz Sharif on Monday directed the State Bank of Pakistan and the Finance Ministry to move against banks that are slow in extending loans to farmers, small and medium enterprises and applicants under the Apna Ghar housing scheme.

He gave the instruction while chairing a review meeting in Islamabad on credit access for priority sectors, as reported by ProPakistani. The Associated Press of Pakistan carried the prime minister's statement that improving the economy and creating jobs for young people through SMEs, housing and agriculture was the government's top priority.

The meeting was told that agricultural lending had reached Rs 1,329 billion and about 3.5 million borrowers, that SME financing stood at Rs 1,148 billion across 342,458 businesses, and that total housing finance was Rs 455 billion with 187,317 borrowers, according to ProPakistani.

Under the Apna Ghar programme, loans worth Rs 511 billion had been approved for 86,899 applications as of October 23, 2026, and Rs 91 billion disbursed to 15,584 applicants.

Targets have been set to raise lending to agriculture and to SMEs to Rs 1,500 billion each by the end of fiscal year 2027.

Shehbaz Sharif said SMEs could support growth, lift exports and create jobs. He described agriculture as the backbone of the national economy and said the government wanted to increase exports through value addition in farm commodities. The Apna Ghar scheme, he said, would support housing and construction and the industries linked to the sector.

He directed the finance minister to resolve the financing problems raised by stakeholders in the three sectors and to prepare a comprehensive action plan. The SBP and the Federal Board of Revenue were told to work jointly on the tax issues facing SMEs and exporters, and to develop a risk coverage strategy to ease SME lending.

The prime minister praised banks that had performed well under the government schemes and said financial institutions should give the priority sectors the same cooperation they receive from the government and its institutions.

Officials briefed the meeting on the SBP's three pillars for raising priority-sector credit: better regulation, sharing of risk and cost between the government and banks, and expanded digital facilities. The SBP recently launched the SME Connect portal, where businesses can apply for loans and track their applications, at smeconnect.sbp.org.pk.