Pakistan auto finance edges up

Pakistan’s auto lending kept rising in March, with outstanding vehicle loans reaching 345.34 billion Pakistani rupees after a 2.6% monthly increase. (dawn.com) The March total was up from 336 billion rupees in February and marked the 16th straight month of growth in auto finance, according to reporting based on State Bank of Pakistan data. (dawn.com) The lending increase came as Pakistan’s broader borrowing climate stayed easier than a year earlier. The State Bank of Pakistan said on March 9 that it kept its policy rate at 10.5%, after cutting rates sharply from the 22% peak reached in June 2024. (sbp.org.pk) Car buying has been recovering alongside that rate shift. Pakistan Automotive Manufacturers Association data showed total sales of cars, sport utility vehicles, pickups and vans reached 15,531 units in March 2026, up 40% from a year earlier, even though sales fell 9% from February. (dawn.com) Passenger cars made up most of that rebound. The News reported 11,755 passenger cars sold in March, up 45% year on year from 8,130, while month-on-month sales slipped 12% from 13,388 in February. (thenews.pk) That mix points to a market that is recovering unevenly rather than surging across the board. Analysts cited lower interest rates, easing inflation and improving sentiment for the annual gain, while Ramadan and Eid holidays cut working days and weighed on monthly volumes. (thenews.pk, dawn.com) Imports by assemblers also stayed firm in March. Dawn reported completely knocked down and semi-knocked down kit imports rose to $170 million in March from $157 million in February, a sign manufacturers were still preparing for demand in coming months. (dawn.com) Pakistan’s central bank said in its March monetary policy statement that economic activity had continued to strengthen, with high-frequency indicators including auto sales posting higher growth during fiscal 2026. Auto finance is now moving in the same direction: not back to boom conditions, but no longer in retreat. (sbp.org.pk)