2023 Was A Bad Year for Car and House Financing

Car financing continued to fall in the calendar year 2023, down 26 percent YoY to Rs. 251 billion by the end of December from Rs. 337 billion in the same period last year. According to the State Bank of Pakistan (SBP), consumer financing for house building declined by 3 percent (Rs. 7 billion) to Rs. 208 billion by end-December 2023 while the MoM trend shows an increase of Rs. 1 billion (November: Rs. 207 billion). Personal loans on credit cards surged by 25 percent YoY to Rs. 108 billion by end-December. On an MoM basis, loans in this category recorded no change compared to November 2023. Overall credit issued to end-users (consumer financing) fell to Rs. 818 billion in December, a 9.1 percent YoY and 0.8 percent MoM decrease. Outstanding credit to the private sector declined by 1.4 percent YoY to Rs. 8.5 trillion but shows a 4.3 percent MoM increase from Rs. 8.2 trillion in November 2023. Total loans clocked in at Rs. 11.4 trillion.