Bank Loans for Buying Cars Down 2% in January 2025

Car financing decreased by Rs. 4 billion or 2 percent year-on-year (YoY) by the end of January 2025 to Rs. 242 billion compared to Rs. 246 billion in January 2024. However, auto financing increased by Rs. 7 billion up 2.6 percent month-on-month (MoM) compared to Rs. 235 billion in the previous month, data revealed by the State Bank of Pakistan (SBP). The overall growth in the sector remains stunted despite some improvement in consumer inflation seen this fiscal year. A month earlier, car sales saw a huge increase of 69 percent driven by interest rate cuts, higher consumer confidence, and the introduction of new models and variants. Meanwhile, personal loans on credit cards surged by 28 percent YoY to Rs. 141 billion by January 2025. Consumer financing for house building declined by 3.7 percent to Rs. 200 billion during the period in review. Overall credit issued to end-users (consumer financing) improved to Rs. 844 billion in January 2025, a 3.7 percent YoY increase.