Auto financing drops to Rs294bn in June

July 25, 2023 (MLN): Automobile financing in Pakistan has dropped to Rs293.73 billion in June 2023, witnessing a decrease of 20.15% YoY and 2.24% MoM as compared to Rs367.85bn in June 2022 and Rs300.44bn in May 2023, respectively, the data issued by the central bank revealed on Tuesday.

This decrease is mainly attributed to higher interest rates, an increase in car prices, regulative curbs for acquiring loans, and higher taxes on the import of automobiles and their parts.

Going by the SBP data, consumer financing for house building stood at Rs212.32bn by the end of June 2023, a jump of 15.75% YoY mainly due to SBP’s measures to promote housing and construction of buildings in the country.

However, on a monthly basis, the financing for house building remained almost flat, with a decline of 0.2%.

Meanwhile, financing for personal use clocked in at Rs252.63bn, up by 0.48% YoY while on a monthly basis, the financing for the same category inched up by 0.19%.

This led the overall credit disbursed to consumers to rise to Rs859.73 bn during the review month, registering a decline of 4.4% YoY and 0.57% MoM.

The outstanding credit to the private sector grew by a meager 0.17% YoY and 0.44% MoM to Rs8.28tr in June 2023.

Loans to the manufacturing sector increased by 2.01% YoY to Rs4.54tr in the review period and on a monthly basis, the loans to the same sector ticked up by 0.33% MoM.

The borrowing from the construction sector stood at Rs190.23bn in June 2023, increasing by 0.99% YoY, while decreasing by 0.24% MoM.

Meanwhile, loans to the agriculture, forestry, and fishing sector rose to Rs344.33bn in the month under review, up by 5.48% YoY and on a sequential basis, the loans to the same sector recorded an increase of 1.8% MoM.

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