AGL 5.78 Increased By ▲ 0.03 (0.52%)
ANL 8.88 Increased By ▲ 0.03 (0.34%)
AVN 78.93 Decreased By ▼ -0.57 (-0.72%)
BOP 5.29 Increased By ▲ 0.12 (2.32%)
CNERGY 4.70 Increased By ▲ 0.01 (0.21%)
EFERT 81.57 Increased By ▲ 0.47 (0.58%)
EPCL 50.96 Decreased By ▼ -0.03 (-0.06%)
FCCL 13.35 Decreased By ▼ -0.14 (-1.04%)
FFL 5.74 Decreased By ▼ -0.07 (-1.2%)
FLYNG 7.15 Decreased By ▼ -0.06 (-0.83%)
FNEL 4.82 Increased By ▲ 0.02 (0.42%)
GGGL 8.87 Increased By ▲ 0.17 (1.95%)
GGL 15.90 Increased By ▲ 0.15 (0.95%)
HUMNL 5.79 Decreased By ▼ -0.06 (-1.03%)
KEL 2.68 Increased By ▲ 0.10 (3.88%)
LOTCHEM 29.06 Decreased By ▼ -0.44 (-1.49%)
MLCF 24.99 Decreased By ▼ -0.31 (-1.23%)
OGDC 72.46 Increased By ▲ 0.01 (0.01%)
PAEL 15.35 Decreased By ▼ -0.05 (-0.32%)
PIBTL 5.06 Decreased By ▼ -0.09 (-1.75%)
PRL 16.31 Increased By ▲ 0.06 (0.37%)
SILK 1.08 Increased By ▲ 0.01 (0.93%)
TELE 9.39 Increased By ▲ 0.09 (0.97%)
TPL 7.34 Decreased By ▼ -0.01 (-0.14%)
TPLP 18.90 Decreased By ▼ -0.26 (-1.36%)
TREET 21.95 Increased By ▲ 0.10 (0.46%)
TRG 140.87 Decreased By ▼ -1.93 (-1.35%)
UNITY 17.01 Decreased By ▼ -0.19 (-1.1%)
WAVES 9.90 Decreased By ▼ -0.13 (-1.3%)
WTL 1.41 Increased By ▲ 0.03 (2.17%)
BR100 4,255 Increased By 7.1 (0.17%)
BR30 15,733 Decreased By -28.8 (-0.18%)
KSE100 42,394 Increased By 44.9 (0.11%)
KSE30 15,664 Increased By 31.9 (0.2%)
Follow us

Outstanding consumer financing for transport, which includes purchase of cars etc, stood at Rs353 billion as of August 2022, a decline of Rs8 billion or 2.6% month-on-month (MoM), figures released by the State Bank of Pakistan (SBP) revealed on Tuesday.

This is the lowest level since January 2022, said Arif Habib Limited (AHL) in a note.

“Moreover, the cumulative decline in auto financing since June 2022 to August 2022 has been around Rs15 billion.”

The dip in financing comes in tandem with drop in auto sales and high interest rates.

Passenger car sales in August stood at 8,980 units, reflecting a drop of 50% year-on-year (YoY) and 13% MoM.

Pak Suzuki announces further extension in automobile plant shutdown

Recently, the need for prior permission to import raw materials by the SBP has led to lower inventory levels and slashed production in the auto industry. At the same time, increased auto financing rates due to interest rate hikes have also curbed demand, while high inflation has shrunk purchasing power as well.

“The dip in auto financing comes as overall auto production and sales have declined significantly, amid SBP measures to curb imports of CKD units,” Tahir Abbas, Head of Research at AHL, told Business Recorder.

Meanwhile, demand for automobiles has also dropped as the interest rate remains high, while the overall economy remains in a slowdown, said Abbas. He shared over 25% of auto sales come through auto financing.

“This is expected to decline further in the coming months,” said Abbas.

Auto financing for consumers: SBP reduces loan tenure as import bill bites

Moreover, central bank data showed that loans for house financing clocked in at Rs206 billion in August, an increase of 84.4% YoY and 2.3% MoM, which is mainly due to a rise in house prices, thus increasing the financing requirement, shared Abbas, adding that home financing would stabilise in the coming months.

Meanwhile, financing for personal loans stood at Rs250.76 billion, up by 5% YoY, however, on monthly basis, it remained flat.

Auto loans in a sinkhole


Comments are closed.

Aziz Ur Rahman Sep 21, 2022 01:29am
In a country which is confronting economic problems, invreasing poverty and a huge trade deficit is it becoming to have mercedes, KIAs and cars of higher level than 13cc Europe is richer than Pakistan yet the majority of the cars are small It is economically suecidal to manufacture such dinosars No body need small driving a small car The government should set an example by selling off its fleet of big cars and then the production and import of cars above 1300 CC
thumb_up Recommended (0)

Auto financing falls in August

Rupee registers gains, settles at 223.69 against US dollar

Rise in TTP attacks in Pakistan should be concern for Afghan Taliban as well: Rana Sanaullah

SBP-held foreign exchange reserves fall $327mn, stand at $7.5bn

Fawad says PTI to dissolve Punjab, KP assemblies next week

EU tentatively agrees $60 a barrel price cap on Russian seaborne oil

No restrictions placed on LCs for import of oil, other petroleum products: SBP

Record-breaking England put Pakistan to the sword in first Test

Google app payments: IT ministry says issue resolved

Oil buoyed by OPEC+ output speculation and easing China COVID curbs

Economic advice: Dar constitutes 11-member reform, resource mobilization commission