SBP revises mark-up rates for flood-hit areas
KARACHI: State Bank of Pakistan (SBP) has revised down the mark-up rates for various refinance schemes at 6 percent in order to encourage credit to private sector, exports and local production throughout the country. In this regard, the central bank notified that it reduced the mark-up rates to 6 percent for banks borrowers living in the flood affected areas under refinance scheme for revival of SMEs & agricultural activities in flood affected areas of 2014.
The notification stated that refinance under the scheme shall be provided to the banks at 3.00% p.a whereas the banks shall be permitted to charge a maximum spread of 3.0% p.a. from the borrowers. Therefore, financing to SMEs/farmers will be available at 6.00% p.a. to be effective from July 1, 2015. The central bank notified that the scheme for financing power plants using renewable energy re-fixation of rates of service charges at 6 percent whereas same rate has been decided for refinance facility for modernization of SMEs re-fixation of rates of service charges. The central bank has fixed the mark-up users at 6 percent whereas it allows banks to maintain its spread from 1 to 3 percent on various schemes increasing on the period of borrowing from 1 to 5 years to 5 to 10 years.