{
  "id": 17908126,
  "title": "Private sector turns net borrower",
  "url": "https://urgent.news/2026/11/03/private-sector-turns-net-borrower",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-11-03T02:08:41.000Z",
  "source": {
    "name": "Dawn Business",
    "slug": "dawn-business",
    "url": "https://www.dawn.com/news/2041700/private-sector-turns-net-borrower"
  },
  "original_language": "en",
  "account": "For the first time in 2026-27, private sector banks have begun to net borrow from financial institutions, a shift from previously retiring their own debt. This change seems to be the result of the government's ongoing efforts to encourage banks to provide maximum liquidity to the private sector. State Bank data indicated that during the period from July 1 to October 23, FY27, private-sector net borrowing amounted to Rs87 billion, as opposed to Rs29 billion in debt retirement during the same period in the previous fiscal year. Prime Minister reiterated his demand for the Ministry of Finance to take action against banks delaying loan disbursements to farmers, small and medium-sized enterprises, and applicants under the Prime Minister’s Apna Ghar scheme, however, banks have yet to provide sufficient liquidity to stimulate the private sector and boost the growth rate beyond its levels of the past four years. The State Bank's data revealed that only Islamic branches of conventional banks extended loans rather than receiving debt retirement as seen in both Islamic and conventional banks. Conventional banks recorded only a slight debt retirement of Rs320 million, compared to Rs117 billion retired in the same period last fiscal year. Islamic banks, on the other hand, recorded a net debt retirement of Rs63 billion, an increase from Rs25 billion in the previous fiscal year. Banks face significant risks when lending to the private sector, while the private sector is hesitant to borrow and invest. The reasons for this reluctance are high borrowing costs, political uncertainties, including terrorism in two provinces, and a looming war in the region. Last week, the State Bank increased the interest rate by 50 basis points to 12%, further reducing investors' chances of borrowing. Bankers and analysts believe that the State Bank will have to increase the interest rate again in the coming months, as the four-month average inflation is still in double digits.",
  "summary": "KARACHI: For the first time in 2026-27, the private sector has shifted from retiring debt to net borrowing from banks. The change appears to be the outcome of the government’s continuous effort to force banks to pump maximum liquidity into the private sector. State Bank data on Monday showed that private-sector net borrowing was Rs87 billion during July 1 to Oct 23 FY27, compared with Rs29bn in…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}