Engine size changes everything under SBP rules.
Pick your engine capacity and this calculator applies the right State Bank of Pakistan down payment and tenure limits automatically, then checks your instalment against the SBP's 40% debt burden ratio cap.
Sets the SBP minimum down payment (30%) and max tenure (5yr)
SBP minimum: 30% for this engine class
Monthly Instalment
Rs 99,675
60 months \u00b7 KIBOR 10.89% + 4.0% spread = 14.89%
Amount Financed
Rs 4,200,000
Total Markup
Rs 1,780,522
Total Paid
Rs 7,780,522
The SBP caps total auto financing per person at Rs 3,000,000 across all banks combined, at any point in time.
Car financing in Pakistan is priced off KIBOR, the Karachi Inter-Bank Offered Rate, which stood at roughly 10.89% for the 1-year tenor as of March 2026. Banks add their own spread on top — anywhere from 2.5 percentage points at Bank AL Habib, the cheapest major lender, to 4.5-6 points at pricier banks — giving total markup rates across the eight major banks running roughly 13.4% to 19% as of mid-2026.
But the rate is only half the picture, because engine size changes which regulatory regime you fall under entirely. The State Bank of Pakistan's Prudential Regulations split financing into two different sets of rules depending on engine capacity: for vehicles above 1,000cc — the large majority of sedans and SUVs — the maximum tenure is capped at 5 years and the minimum down payment is 30%, tightened specifically in a 2026 move to slow import-linked demand. Locally manufactured or assembled vehicles up to 1,000cc — Pakistan's economy-car segment, including the Suzuki Alto and Cultus — were explicitly exempted to protect lower and middle-income buyers, and still follow the older, looser rules: down payments as low as 15% and tenures up to 7 years at some banks. That single distinction changes the real affordability math more than almost anything else a buyer controls.
Unlike the softer “rule of thumb” guidelines used in some other markets, Pakistan's affordability check is a hard regulatory requirement rather than a suggestion. The SBP caps the total auto financing any one person can hold across every bank and DFI combined at Rs 3,000,000 at any point in time, and requires lenders to keep a borrower's total debt burden ratio — all loan repayments combined, measured against income — at or under 40%. Industry voices have been blunt about the practical effect of this: Ahmed Shamim of Dubai Islamic Bank Pakistan's consumer auto finance desk has publicly said the 40% DBR cap combined with the 30% down payment requirement makes it effectively impossible for someone earning Rs 100,000 a month to qualify for financing on anything beyond the smallest car. This calculator's income check uses the same 40% ceiling banks are legally required to apply, not a softer suggestion you're free to ignore.
10.89%
1-year KIBOR, March 2026 (SBP-verified)
40%
Maximum debt burden ratio (SBP-mandated, not a guideline)
Rs 3M
Aggregate auto financing cap, per person, all banks combined
Three genuinely different financing structures compete for the same customer, not just different rates on the same product. Conventional banks — HBL, UBL, MCB, Bank Alfalah, Bank AL Habib, JS Bank, and Allied Bank — lend on a straightforward interest basis, KIBOR plus their own spread. Meezan Bank's Car Ijarah, Pakistan's largest Islamic car financing product, works as a lease: the bank buys the car and owns it throughout the term, renting it to you, with ownership transferring at the end against your initial security deposit. BankIslami's Auto Musharaka takes a third approach, Diminishing Musharakah: you and the bank co-own the car from day one, and each monthly payment buys out a growing share of the bank's stake until the car is fully yours. Despite the real structural and Shariah-compliance differences between these three, the monthly cost works out to broadly comparable instalment math for comparison purposes, which is why this calculator — like most Pakistani comparison tools — uses one unified calculation across all three rather than three incompatible formulas.
Overseas Pakistanis get a specific carve-out most residents don't. The SBP exempted the “Roshan Apni Car” product from the 2026 tightening entirely: available to non-resident Pakistanis who hold a Roshan Digital Account, it keeps access to tenures up to 7 years regardless of the car's engine size, a deliberate policy choice to keep remittance-funded car purchases flowing even while resident financing tightened. It's offered by most major banks, including Allied Bank and Bank Alfalah, under this exact product name — worth asking for specifically if you qualify, since it isn't subject to the same cc-based restrictions covered above.
Ahmed earns Rs 150,000 a month and wants a Toyota Corolla priced at Rs 6,000,000, which at 1,600cc falls under the standard, tightened regime. With a 30% down payment (Rs 1,800,000) and a bank quote of KIBOR (10.89%) plus a 4% spread — 14.89% total — financing Rs 4,200,000 over the maximum allowed 5 years gives a monthly instalment of roughly Rs 99,700, about 66% of his income — well above the SBP's 40% debt burden ratio ceiling, meaning he wouldn't actually qualify for this financing as structured. Raising his down payment to 45% or choosing a cheaper car are the two realistic paths to bringing the ratio under the cap a bank is legally required to enforce.
Used cars add a second layer of restriction on top of the engine-size rules. Most banks only finance used vehicles up to a certain age at the time of application — commonly around 5 years old — and several, including Meezan Bank, apply a higher minimum down payment on used cars than new ones, since a used vehicle's resale value is harder to predict than a new one straight from the showroom. The aggregate Rs 3,000,000 financing cap and the 40% debt burden ratio apply identically whether the car is new or used, so a cheaper used car mainly helps by keeping the amount financed, and therefore the instalment, further under that ceiling.
With eight major banks and three distinct financing structures competing for the same buyer, the spread between the cheapest and most expensive options is wide enough to be worth real shopping around. Bank AL Habib's Apni Car has the cheapest published spread at KIBOR plus 2.5 points; HBL offers a 50% processing fee discount specifically for female applicants; UBL Drive carries the highest minimum down payment in the market at 30% with a fixed-rate option available; and MCB Car4U sets the strictest minimum salary threshold among the major lenders. None of these differences show up in the headline markup rate alone, which is exactly why comparing more than one bank's full terms — not just the advertised rate — matters more in Pakistan's car financing market than in most others.
Rates are KIBOR plus a bank spread. With 1-year KIBOR around 10.89%, total rates run roughly 13.4% (Bank AL Habib) to 19% (JS Bank). Islamic products like Meezan Car Ijarah run a comparable 14-17%.
For vehicles above 1,000cc, the SBP requires a minimum 30% down payment. Locally made vehicles up to 1,000cc are exempted and can qualify with as little as 15% down at some banks.
Up to 5 years for vehicles above 1,000cc under the 2026 tightened rules (down from 7). Local vehicles up to 1,000cc, and Roshan Apni Car for overseas Pakistanis, can still reach 7 years at some banks.
The SBP requires banks to keep total debt repayments, across all loans combined, at or under 40% of income — a hard regulatory requirement, not a soft guideline.
Conventional financing is interest-based (KIBOR + spread). Meezan Car Ijarah is a lease where the bank owns the car and rents it to you. BankIslami’s Auto Musharaka is Diminishing Musharakah — you and the bank co-own the car from day one.
The SBP caps total auto financing per person at Rs 3,000,000 across every bank and DFI combined, at any point in time.
Yes, through Roshan Apni Car, available to non-resident Pakistanis with a Roshan Digital Account. It was exempted from the 2026 tightening and can reach 7-year terms regardless of engine size.
Reviewed by Evelyn John, Auto Sales Expert. Rates and regulations checked against the State Bank of Pakistan's Prudential Regulations for Consumer Financing, published 2026 bank rate comparisons, and SBP-verified KIBOR data.