Private Sector Credit Rises to Rs11.38 Trillion by End-June

Credit to Pakistan's private sector climbed to Rs11.38 trillion by the end of June 2026, marking a 14.8% year-on-year increase, according to State Bank of Pakistan (SBP) data. The rise reflects improving economic activity and a stronger appetite among banks to lend following a series of policy rate cuts.

 

Analysts noted that private sector credit has continued to recover after a sluggish FY23, with outstanding credit increasing from Rs9.92 trillion in June 2025 to Rs11.38 trillion in June 2026. The rebound has been supported by the SBP's monetary easing cycle, which reduced borrowing costs and encouraged banks to shift lending back toward the private sector.

 

Manufacturing remained the largest recipient of credit, while wholesale and retail trade, along with the telecommunications sector, also recorded strong growth. However, analysts observed that lending continues to be concentrated in short-term working capital rather than long-term investment, indicating that the recovery remains driven by business activity and consumption rather than large-scale capital expansion.

 

Consumer financing also posted solid growth, rising 25.4% year-on-year to Rs1.145 trillion. Auto financing increased 38% from a year earlier to Rs381.68 billion, highlighting stronger demand for retail credit.