National Bank of Pakistan (NBP) has signed a memorandum of understanding (MoU) with City District Government Karachi (CDGK) to provide housing finance to its employees for the purchase, construction, renovation and repair of housing units. According to an announcement here on Thursday, NBP will provide housing loans under NBP-Saiban to approximately 150,000 employees of CDGK on reduced mark up and flexible terms and conditions.
A senior executive of NBP, Aamir Siddiqui said that the financing facility has a prepayment option without any penalty.
He said that hardly one percent of CDGK employees have their own houses and NBP housing facility will enable them to get a shelter on easy terms. He said that NBP has secured the financing rights after a long and intense battle with other banks including HBL. Giving details of the salient features of the scheme, he said CDGK employees with a salary of Rs 5,000 per month are eligible for this facility.
Siddiqui said that tenure of the loan ranges from three to 20 years for home purchase and construction whereas for home improvement this tenure ranges from three to 15 years.
The maximum amount of loan will be Rs 10 million with debt-equity ratio of 85:15 for home purchase and construction and 70:30 for home improvement.
Siddiqui said that Saiban scheme would play an important role in generating economic activity in Karachi, besides creating job opportunities and investment.
He was of the opinion that the bank will lend about Rs 15 billion per year to CDGK employees under housing finance. There is a potential for lending at least Rs 75 billion in next five years to CDGK employees under housing purposes, he added.
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