Contrary to expectations, aggregate supply did not catch up with demand. This was due to the misallocation of capital in non-productive sectors, and due to important structural rigidities, which policy-makers neglected to tackle in the boom years. Concerning the public sector, good times were not used to build up the necessary fiscal leeway and asset booms made fiscal positions appear sounder than they were.
Under the programs sponsored by these donors, a number of market interventions are managed by SBP including: The Institutional Strengthening Fund (ISF) providing grant funding to Microfinance (MF) providers to top and middle tier Microfinance Banks (MFBs) and Microfinance Institutions (MFIs) for key investments in HR, IT, product development, risk management systems, business plans and branchless banking development.