Pakistan says private-sector lending doubled to $3.9 billion since 2021–22 amid credit push 

ISLAMABAD: Private-sector lending in Pakistan has doubled to 1.1 trillion rupees ($3.9 billion) since the 2021–22 fiscal year as the government pushes banks to expand credit to businesses and small farmers to support economic recovery, according to a statement released by the Prime Minister’s Office on Wednesday.

The announcement comes as Pakistan, under pressure from the International Monetary Fund, seeks to revive private investment in an economy long dominated by government borrowing and weak credit growth. Private-sector lending in Pakistan has historically lagged regional peers, constrained by high interest rates, risk-averse banks and limited access to formal finance for small and medium-sized enterprises (SMEs).

Expanding credit to businesses and agriculture is a key pillar of Islamabad’s broader reform agenda, aimed at boosting exports, job creation and economic inclusion after years of balance-of-payments crises. Pakistan’s banking sector has traditionally preferred risk-free government debt over private lending, a trend the government says it is now trying to reverse.

“Compared to 2021–22, by December 2025 lending by banks to the private sector has improved, the number of borrowers has doubled to over 303,000 and the volume of credit has reached 1.1 trillion rupees,” Prime Minister Shehbaz Sharif said, according to as statement released by his office.

Sharif was chairing a high-level meeting to review measures to ease access to loans for new businesses, SMEs and small farmers, with a focus on economic inclusion and private-sector financing.

The prime minister said facilitating access to credit for the private sector, particularly SMEs and small farmers seeking modern technology, was among the government’s top priorities.

“Providing loans to the private sector, especially SMEs and small farmers, on easy terms for acquiring modern technology is a top government priority,” Sharif said.

Officials told the meeting commercial banks were being encouraged to prioritize lending for new businesses, machinery and modern technology. Agricultural lending now covers crops, livestock and fisheries, while a fully digital loan application system for farmers, the ZarKhaiz-E App, has already been launched by the central bank, the statement said.

The prime minister directed his special assistant and the Small and Medium Enterprises Development Authority (SMEDA) to work with provincial governments to develop a coordinated national SME policy, including outreach in Gilgit-Baltistan and Azad Jammu and Kashmir.

Sharif said SMEs were the backbone of developed economies and had strong potential to drive exports and employment growth in Pakistan. He added that the government would personally monitor progress and form a sub-committee to further simplify lending procedures for businesses and agriculture.