May 20, 2022 (MLN): Amid an increase in car prices and higher interest rates, automobile financing in Pakistan has witnessed a marginal increase of 0.9% MoM to Rs367 billion in April 2022, Central bank data showed today.
On year-on-year, the auto financing surged by 25% when compared to Rs293bn in April 2021, mainly on the back of increased consumers’ appetite led by the introduction of new models and brands by new entrants, especially in the category of cars above 1,000cc engines.
To note, the sale of passenger cars also witnessed a rise of 29% YoY during April 2022, clocking in at 18,625 units as opposed to 14,435 units in April 2021. While, car sales observed a decline of 18% MoM due to price hikes led by PKR depreciation, higher interest rates, higher taxes coupled with reduced working hours during Ramadan.
Going by the SBP data, for house building, banks’ financing stood at a record level of Rs179bn by the end of April 2022, a jump of 87% YoY and 5% MoM, mainly due to mainly SBP’s measures to promote housing and construction of buildings in the country. Financing for personal use was recorded at Rs245bn, up by 6.2% YoY, while showing a nominal increase of 1.4% MoM.
This takes the overall credit disbursed to consumers at Rs866.5bn during April 2022, registering a growth of 28% YoY and 1.76% MoM.
