The International Monetary Fund (IMF) warned Pakistan on May 12, 2026, that low numbers of Suspicious Transaction Reports (STRs) from the real estate sector undermine efforts to curb untaxed and illicit funds.
The IMF highlighted weaknesses in reporting by Designated Non-Financial Businesses and Professions (DNFBPs), including real estate agents, despite rising trade-based money laundering and poor sharing of beneficial ownership information.
Following these warnings, the Federal Board of Revenue (FBR) conducted raids on major housing societies:
Top City in Islamabad and Al Kabir Town and Al Noor Orchards in Lahore, seizing records over alleged tax evasion and concealed transactions.
The IMF also raised questions about non-performing loans (NPLs) in Pakistan’s banking sector.
Gross NPLs had declined to around 6.1–7.4% by late 2025, but tighter monitoring and oversight of undercapitalised banks remain a priority for the State Bank of Pakistan (SBP).
Authorities have committed to reforms, including banning cash property transactions above Rs. 5 million, tightening beneficial ownership requirements through the SECP, and implementing the STR framework across DNFBPs.
The IMF approved disbursements totalling $1.1 billion under the Extended Fund Facility (EFF), plus $220 million from the Resilience and Sustainability Facility.
