Outstanding auto loans plunge to Rs228bn in July

Despite a downward trend in interest rates, new locally assembled vehicles failed to attract buyers as auto financing continued to fall for the 25th consecutive month, dropping to Rs228 billion in July. As per the State Bank of Pakistan (SBP) data, the outstanding auto loan witnessed a massive drop of Rs140bn from Rs368bn in June 2022. After keeping its policy rate at an unprecedented level for almost four years, the central bank announced a first cut of 150 basis points, from 22 per cent to 20.5pc on June 10, followed by another slashing to 19.5pc on July 29. Private banks have offered deals to prospective buyers due to reduced interest rates and discounted insurance. However, the high prices of locally assembled vehicles remain a serious concern for buyers, as many of them cannot afford the high monthly loan instalments.