Pakistan bank deposits rise 15 % to Rs39.8 trillion while SME loans surge 37 % to over Rs1.0 trillion in FY26.

Pakistan’s banking data for FY26 was released in early August, allowing analysts to assess the sector’s performance. Total deposits reached Rs39.8 trillion, a 15 % increase from the previous year. Deposits as a share of GDP were 31.4 %, sustaining an upward trend but still below the decade‑long average. Loans to small and medium‑sized enterprises surpassed Rs1.0 trillion for the first time, climbing 37 % from FY25 to Rs1.046 trillion in June. SME loans now represented 10.66 % of total private business loans, up 1.8 percentage points from FY25 and the highest level in at least eight years. A five‑year compound annual growth rate of 17 % for SME loans outpaced the 10 % rate in the non‑SME segment. Non‑bank financial institutions increased their share to Rs2.9 trillion, a 48.9 % rise to 31 % of total deposits. Among SME borrowers, the services sector dominated, accounting for Rs570 bn, while agriculture grew from below 1 % to about 12 % of SME loans, achieving a 62 % CAGR to Rs130 bn. The National Financial Inclusion Strategy aims for SME loans to reach 10 % of private credit by FY28, a target already exceeded in FY26. The uptick in SME credit signals a strong banking sector, but inflation and broader economic challenges will shape future policy decisions.