Auto financing in Pakistan is back on the road to recovery, showing steady growth as more people turn to banks to finance their vehicles. According to the latest data from the State Bank of Pakistan (SBP), total car financing reached Rs. 257.36 billion at the end of March 2025—up from Rs. 248.82 billion in February.
Car Financing – Yearly Growth
Compared to the same period last year (March 2024), car financing has jumped 7.5% year-on-year (YoY). This upward trend began in August 2024, when the auto financing figure stood at Rs. 227.3 billion.
While the numbers are moving in the right direction, they’re still below the all-time high of Rs. 368 billion seen in June 2022, before economic tightening and high interest rates cooled off the market.
With inflation and vehicle prices still high, more buyers are turning to bank leasing and auto loans to afford both new and used vehicles. Leasing makes owning a car more manageable through monthly payments, especially for salaried individuals and small business owners.
It’s not just car financing that’s growing. Overall consumer financing rose 8.25% YoY in March 2025, reaching Rs. 873.75 billion. This includes loans for cars, personal needs, and housing.
Key Highlights
- Personal loans climbed to Rs. 267.67 billion, up 10.59% YoY and 0.48% from February.
- Housing finance saw a slight dip of 0.11% MoM, down from Rs. 199.65 billion in February.
The report also shows that outstanding credit to the private sector reached Rs. 9.44 trillion in March. The manufacturing sector remained the largest borrower, with loans totaling Rs. 5.41 trillion, marking an 11.92% YoY increase.
Other sectors also saw healthy credit growth:
- Construction: Rs. 212.76 billion (+9.43% YoY)
- Agriculture, forestry, and fishing: Rs. 445.05 billion
The rise in auto and consumer financing is a promising sign for Pakistan’s economy, especially after a period of financial slowdown. It shows that consumer confidence is slowly returning, and banks are becoming more willing to lend. If this trend continues, we may see a stronger recovery in the automotive and housing sectors in the coming months.
