Private sector turns net borrower

Private-sector borrowers took a net Rs87 billion from banks between July 1 and Oct 23 in FY27, reversing the Rs29bn of debt repayment recorded over the comparable period last year, Dawn reported, citing State Bank data. The shift comes amid government pressure on banks to expand lending to businesses and other private borrowers.

Prime Minister reiterated that the Finance Ministry should act against banks delaying loans for farmers, SMEs and applicants to the Apna Ghar scheme. Lending remains limited, while high borrowing costs, political uncertainty and regional conflict concerns are cited as obstacles to borrowing and investment. The SBP raised its interest rate by 50 basis points last week to 12pc, and bankers and analysts expect further increases as average inflation over four months remains in double digits.