202pc jump in private sector borrowing

KARACHI: The private sector borrowing from banks has gone up by over 200 per cent from July to May 20 of the current fiscal year, reflecting that the higher economic activities remained intact despite the change of government in Islamabad.

During the last one month, from April 20 to May 20, the private sector borrowed Rs179 billion, more than the average monthly borrowing of Rs130bn.

Despite political uncertainty during this period of one month, the growth in private sector credit offtake remained high.

According to data released by the State Bank of Pakistan (SBP) on Tuesday, the private sector borrowed Rs1,414bn from July 1 to May 20, FY22, up from Rs468bn in the same period last year, a 202pc increase.

The current private sector borrowing is higher than the cumulative total of the last two years. The private sector borrowed Rs766bn in FY21 and Rs196bn in FY20, bringing the total to Rs962bn.

The conventional banks played a key role in the large private sector advances, but the Islamic banks and Islamic branches also increased their shares to a significant level.