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Auto financing in Pakistan saw a strong rebound in July 2025, rising 25.3% year-on-year (YoY) to Rs. 286 billion, up from Rs. 228 billion in July 2024, according to State Bank of Pakistan (SBP) data compiled by Arif Habib Limited (AHL). On a month-on-month (MoM) basis, auto loans also increased 3.3% from Rs. 277 billion in June 2025, continuing the recovery trend that started in mid-2024 after a slowdown.
This growth in auto loans comes despite a 1.9% MoM decline in total private sector loans, which fell to Rs. 9.48 trillion. Within this, business lending decreased 2.6%, while consumer financing rose 1.7% to Rs. 929 billion.
Other lending trends in July 2025 include:
| Loan Type | July 2025 (Rs. Billion) | MoM Change | YoY Change |
| Auto Loans | 286 | +3.3% | +25.3% |
| Personal Loans | 263 | +2% | – |
| Credit Card Borrowing | 163 | +2.6% | – |
| House Building Finance | 208 | +0.7% | – |
| Total Private Sector Loans | 9,480 | -1.9% | +14.4% |
Analysts attribute the rise in auto financing to improved macroeconomic stability, lower borrowing costs, and easing inflation, which have restored consumer confidence. Auto loans had declined in 2022–2023 due to higher interest rates, import restrictions, and weak demand.
According to SBP figures, total private sector loans expanded 14.4% YoY, with business lending still dominating at Rs. 8.2 trillion. The rising trend in auto loans underscores the resilience of consumer demand and the gradual recovery of Pakistan’s credit market.
Experts predict continued growth in vehicle financing as new models hit the market and banks offer competitive loan packages, signaling a positive outlook for the automotive and financial sectors in Pakistan.
