Pakistan sees 18th straight month of decline in auto financing

In December 2023, automobile financing in Pakistan recorded a significant decline, reaching Rs251.25 billion, marking a 25.55 per cent year-on-year drop and a 2.26 per cent month-on-month decrease. 

This contrasts with Rs333.747 billion in December 2022 and Rs257.06 billion in November 2023, as revealed by the latest central bank data.

Notably, this marks the eighteenth consecutive monthly decrease in automobile financing, attributed to factors such as elevated interest rates, a surge in car prices, regulatory constraints on loan acquisition, and increased taxes on automobile imports and components.

According to data from the State Bank of Pakistan (SBP), consumer financing for house building reached Rs208.15 billion by the end of December 2023, reflecting a 3.17 per cent year-on-year decrease. 

On a monthly basis, house building financing showed a marginal increase compared to the previous month’s Rs206.92 billion.

Simultaneously, financing for personal use amounted to Rs244.41 billion, experiencing a 3.84 per cent year-on-year decline and a 0.64 per cent month-on-month decrease, indicating a challenging trend in the lending landscape for various purposes.