The government on Wednesday signed an agreement with the World Bank on a housing finance worth $85 million. The project will help give those in low-income households access to affordable mortgages and increase home ownership, while also supporting capital market development.

Federal Minister for Economic Affairs Sardar Ayaz Sadiq witnessed the signing ceremony of the agreement with the World Bank at the Ministry of Economic Affairs Islamabad, the ministry said in a statement.

“Today’s event reflects continued confidence by the World Bank on the government’s policy and programs,” said Sadiq, while adding that the primary beneficiaries of this project will be low- and middle-income households in Pakistan reliant on informal incomes.

Mian Asad Hayaud Din, Secretary, Ministry of Economic Affairs Pakistan and Gailius J. Draugelis, Acting Country Director, World Bank signed the financing agreement, while representative of Pakistan Mortgage Refinance Company signed the project agreement.

Gailius said the deal was part of the World Bank’s continuous financial and technical assistance to Pakistan to help promote inclusive and sustainable economic growth.

Meanwhile, the ministry said the financing will fund the initial capitalization of sub-trust of the Risk Sharing Facility created under the parent project of $140 million being executed by Pakistan Mortgage Refinance Company.

It added that the project will enable primary mortgage lenders to move from the very upper end of the households in the 5th quintile to lower quintile income groups, and that the financial sector at large will also benefit greatly as the project will help deepen the primary mortgage market, in addition to supporting the development of capital market.

Pakistan Housing Finance Project: WB lists risks to $85m additional financing