Car Loans in Pakistan Hit a Record Rs 393.4 Billion in August 2026

Car loans in Pakistan reached a record Rs 393.4 billion at the end of August 2026, according to State Bank of Pakistan data. That is Rs 99.3 billion more than a year earlier, a rise of 33.77 per cent from Rs 294.08 billion in August 2025.

We read the figure in the State Bank's own table. The August number is provisional and can still change slightly.

The old peak was Rs 367.8 billion in June 2022. Car financing fell for two years after that, bottomed out in August 2024, and has climbed back past the 2022 level. May 2026 was the first month above it, and every month since has set a new high.

Car financing hit Rs 393.4 billion in August 2026

Outstanding car financing from banks stood at Rs 393,397 million at the end of August 2026. That is the total still owed on car loans across all banks and DFIs. It rose Rs 7.1 billion in one month, from Rs 386.3 billion in July.

"Outstanding" matters here. The figure is not new loans given in August. It is the stock of money still owed, after new loans are added and monthly repayments are taken off.

The State Bank lists car loans under consumer financing, in a line called "for transport i.e. purchase of car etc". Total consumer financing was Rs 1,233.7 billion in August 2026. Car loans made up about 32 per cent of it, the largest single piece, ahead of house loans at Rs 315.8 billion and credit cards at Rs 218.8 billion.

One thing the figure leaves out: car loans that banks give their own staff. Those sit in a separate line, Rs 89.6 billion in August 2026, and are not part of the Rs 393.4 billion.

Car loans have grown every month since December 2024

State Bank data shows car financing rising each month from December 2024 to August 2026, a run of 21 months. The stock fell from Rs 367.8 billion in June 2022 to Rs 227.3 billion in August 2024, then turned.

April to June 2026 added more than Rs 36 billion. July and August were slower.

Lower interest rates are the main change since 2024

The biggest change for borrowers since 2024 is the cost of money. The State Bank held its policy rate at 11.5 per cent on 14 September 2026. Car loans are usually priced at KIBOR plus a bank margin, so a lower policy rate means cheaper instalments.

The State Bank's data does not say why people borrow, but the timing fits. The two-year fall began in mid 2022, when interest rates were high and the State Bank had just tightened its car loan rules. The recovery began as rates came down. You can read the latest decision in the State Bank's September rate hold.

The rules themselves did not loosen. The limits below are the ones set in 2021 and 2022, and we found no later circular relaxing them.

State Bank rules still cap every car loan

State Bank prudential rules limit car loans in four ways: a Rs 3 million total per person across all banks, a 30 per cent minimum down payment, a maximum tenure of 3 or 5 years by engine size, and instalments capped at 40 per cent of income.

We read these in State Bank circular letters No. 29 of 2021 and No. 19 of 2022.

1. Total limit: one person's car loans from all banks together cannot exceed Rs 3,000,000 at any time.
2. Down payment: at least 30 per cent of the vehicle's value.
3. Tenure: up to 3 years for vehicles above 1,000cc, and up to 5 years for vehicles up to 1,000cc.
4. Income test: all consumer loan instalments together should not exceed 40 per cent of your net disposable income.
5. Imported cars: new and used imported vehicles are not eligible for bank car financing.

What the record means if you are buying a car

For a buyer, the record shows banks are keen to lend again. It does not mean loans are easy. You still need 30 per cent upfront, you still face the Rs 3 million cap, and your instalment can change when KIBOR moves.

Three practical points:

• With a Rs 3 million cap and 30 per cent down, a single loan can finance a car worth up to about Rs 4.3 million. Above that, you pay the extra in cash.
• Staying at 1,000cc or below gets you five years instead of three, which cuts the monthly instalment a lot.
• Ask the bank for its margin over KIBOR and how often the rate resets. A rate held at 11.5 per cent today can move at the next meeting.

Rates, insurance and the extra costs are set out in car financing rates and limits in Pakistan. Car prices may also change under the new auto policy, and the draft is explained in what Auto Policy 2026-31 changes for car buyers.

Honest view: a record in loans owed is not the same as a record in cars sold. Prices are far higher than in 2022, so each loan is bigger. The same number of buyers now owes more.

Common questions

How much car financing is outstanding in Pakistan?

Rs 393.4 billion at the end of August 2026, according to provisional State Bank data. It is the highest level on record.

What was the previous record for car loans?

Rs 367.8 billion in June 2022. Car financing passed that level in May 2026 and has risen every month since.

How much can I borrow for a car from a bank?

Up to Rs 3 million in total across all banks, under State Bank rules. You must pay at least 30 per cent of the car's value as down payment.

How long can a car loan run in Pakistan?

Up to 5 years for cars of 1,000cc or less, and up to 3 years for cars above 1,000cc.

Can I get a bank loan for an imported car?

No. State Bank rules say new and used imported vehicles are not eligible for bank car financing.

Last checked and sources

Last checked on 27 September 2026. The August 2026 figure of Rs 393,397 million, the August 2025 figure of Rs 294,075 million, the June 2026 figure of Rs 381,687 million, total consumer financing and the other consumer lines are from the State Bank of Pakistan table Credit/Loans Classified by Borrowers, where August 2026 is provisional. The monthly series from June 2022 is from the same table's archive file on the State Bank website. The 33.77 per cent rise and the monthly changes are our arithmetic. The loan limits are from State Bank BPRD Circular Letter No. 29 of 2021 and BPRD Circular Letter No. 19 of 2022. The 11.5 per cent policy rate is from the State Bank's monetary policy statement of 14 September 2026. The reasons for the rise are our reading of the timing, not a State Bank finding.