ECC has enhanced the Mera Ghar Mera Aashiana housing loan limit to Rs 10 million with a uniform 5% mark-up to boost affordable home ownership and construction jobs.
What Is the Mera Ghar Mera Aashiana Housing Scheme?
The Economic Coordination Committee (ECC) of the Cabinet has reviewed and upgraded the “Mera Ghar Mera Aashiana (MGMA)” Mortgage Financing for Low-Cost Housing scheme. This programme is being implemented through the State Bank of Pakistan (SBP) under a mark-up subsidy and risk-sharing framework to support affordable housing finance. It aims to make home ownership possible for low and middle-income families who normally struggle to qualify for long-term bank loans.
Originally approved by the ECC in July 2025 and later endorsed by the Federal Cabinet, the scheme has received a strong response. By 13 February 2026, banks had received more than 10,594 loan applications worth about Rs 32.3 billion, and had disbursed 344 loans amounting to around Rs 810 million. These numbers show that people are interested in using subsidised mortgage finance, but they also highlight the need to scale up and simplify access for more households.
Why Did ECC Approve Changes to the Scheme?
The latest ECC meeting, chaired by Finance Minister Senator Muhammad Aurangzeb at the Finance Division, considered a summary from the Ministry of Housing and Works. The proposal reflected directions from the Prime Minister’s Office and consultations with key stakeholders including SBP, the Finance Division, commercial banks and the Pakistan Banks’ Association. The goal was clear: increase the scale, outreach and impact of the MGMA scheme without creating excessive fiscal pressure.
Officials told the Committee that the scheme has already generated encouraging interest but requires updated features to match rising construction costs and urban housing needs. By adjusting loan sizes, mark-up rates and eligibility criteria, the government hopes to attract more banks, more builders and more genuine home buyers into the formal housing market over the next few years.
Key Changes: Higher Loan Limit, 5% Mark-Up and Wider Eligibility
After detailed discussion, the ECC approved several important changes. The maximum loan limit has been increased to Rs 10 million, making it easier for families to buy slightly larger homes or flats in urban areas. The scheme now targets financing for around 500,000 housing units over the next four years, indicating a strong push to expand the housing stock.
The eligibility parameters have also been widened. Housing units up to 10 marlas (2,720 square feet) and flats up to 1,500 square feet can now be financed under MGMA. A uniform fixed end-user mark-up rate of 5% has been introduced, and previously disbursed loans that were priced at 8% will be adjusted down to 5% to maintain fairness among borrowers. The existing implementation mechanism for the mark-up subsidy and risk-sharing will continue through SBP, allowing banks to manage credit risk while offering lower rates to customers.
Fiscal Planning and Expected Economic Impact
The ECC was informed that year-wise subsidy estimates have been prepared, including projections for the disbursement of about 50,000 housing units up to 30 June 2026. Subsidy payments will be linked to actual loan disbursements and adjusted within annual budget allocations. This is meant to keep the scheme fiscally manageable while still offering meaningful relief to borrowers through reduced mark-up costs.
If implemented effectively, the revised framework is expected to boost demand for housing, stimulate construction and allied industries such as cement, steel, tiles and furniture, and create new employment opportunities across the value chain. It also supports long-term asset building for families by turning monthly rent-style payments into equity in their own homes. For banks, the risk-sharing model and subsidy support make it more attractive to lend to lower and middle-income borrowers who were previously seen as high risk.
Other ECC Decisions on Agriculture and Rail Connectivity
In the same meeting, the ECC also cleared a Technical Supplementary Grant of Rs 7.289 million for the ICT component of the “National Program for Enhancing Command Areas in Barani Areas of Pakistan.” This project aims to improve water use and agricultural productivity in rain-fed regions, supporting food security and rural incomes.
Another decision involved a Technical Supplementary Grant of Rs 6.61 billion as budgetary cover for the Thar Coal Rail Connectivity Project. The rail link is intended to move indigenous coal from the Thar region to power plants and industrial users, with the aim of strengthening energy security and cutting reliance on imported fuels. The meeting was attended by federal ministers, secretaries and senior officials from relevant ministries and regulators, reflecting the high priority attached to both housing and infrastructure reforms.
