According to data released by the central bank on Monday, automobile financing in Pakistan dropped to Rs309.09 billion in April 2023, reflecting a year-on-year (YoY) decrease of 15.73% and a month-on-month (MoM) decline of 2.46%. In comparison, the figures were Rs366.79 billion in April 2022 and Rs316.9 billion in March 2023, respectively.

The decline in automobile financing can be attributed to factors such as higher interest rates, increased car prices, regulatory restrictions on acquiring loans, and higher taxes on automobile imports and parts.

Notably, passenger car sales also experienced a significant drop of approximately 84.73% YoY in April 2023, with only 2,844 units sold compared to 18,626 units in the same month of the previous fiscal year, as reported by the Pakistan Automotive Manufacturers Association (PAMA).

On the other hand, consumer financing for house building reached Rs213.04 billion by the end of April 2023, representing a YoY increase of 19.15%. This growth can be attributed to measures implemented by the State Bank of Pakistan (SBP) to promote housing and construction in the country. However, on a monthly basis, financing for house building remained relatively unchanged, with a slight decline of 0.86% MoM.

Financing for personal use amounted to Rs250.13 billion, showing a YoY increase of 2.25%. Monthly data revealed that financing in this category remained relatively stable.

Overall, the credit disbursed to consumers reached Rs867.76 billion during the review month, marking a modest YoY growth of 0.15%. However, on a monthly basis, it experienced a decline of 1.28%.

Meanwhile, the outstanding credit to the private sector witnessed a YoY growth of 4.85% in April 2023, reaching Rs8.44 trillion.

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