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A huge number of people who applied for the subsidized loan for housing under Mera Pakistan Mera Ghar (MPMG) scheme became worried regarding their approved loan programs when the State Bank of Pakistan (SBP) directed banks to halt further disbursements under the program, the finance ministry has assured that disputes about the scheme would be resolved within a week.

When the extreme resentment was shown by the applicants, particularly those who had made down payment of the loan to avail of the subsidy facility announced by the last government of Pakistan Tehreek-e-Insaf (PTI), Finance Minister Miftah Ismail announced that the government is reshaping the scheme.

Talking to Twitter, Miftah said many people were complaining to him that their loans were approved in the Mera Ghar scheme and that they have paid money based on that approval. “I want to assure you that we are reshaping this scheme and no one will lose their money. We will resolve the issues within the next week.”

Last month SBP paused loan disbursement under Mera Pakistan Mera Ghar (MPMG) scheme till August 31, 2022, as well as delaying fresh disbursements under the Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme till July 15, 2022.

Soon after the incident, the applicants and beneficiaries of the housing program started showing their anger and they even decided to protest outside the central bank in Karachi and in front of the Ministry of Finance in Islamabad against the unexpected postponement of the program.

However, the SBP said that the reason for suspending both schemes was the same: “Government of Pakistan is considering review/revise features of the subject scheme in light of recent developments in the macroeconomic scenario.”

Moreover, the SBP data shows that as of 31 May 2022, PKR 473 billion had been demanded, PKR 212 billion had been accepted, and PKR 85 billion had been distributed under MPMG. The outstanding credit for housing and construction remained at PKR 415 billion for May 2022.

 “The disbursement has already been stopped soon after the budget 2022-23,” an SBP official said.

 “It was realized when banks started demanding funds under the scheme that they have crossed the disbursement limit set for the outgoing fiscal year,” an official at the ministry of finance claimed, adding, “Apart from the huge claims of banks, there was a complete lack of coordination among the concerned departments including SBP, banks, and ministry of finance, which ultimately resulted in the mess.”