The purchase of a car in Pakistan isn’t cheap and, as the price of cars rises, individuals frequently utilize auto loans to achieve their goal of owning a car. However, it can be difficult to find a best option for financing your car since the rules of rates, terms and alternatives aren’t always well-defined. The most recent information from Pakistan’s financial institutions are compiled to give you the most popular auto loans in the 2025
1. Car Loan Basics: A Guide for Pakistan
What you need to know about auto Financing
There are a few common elements for auto credit in Pakistan.
The amount you need to make as down payment could vary between 15% to 35%, based on your profile and bank .
The terms: Usually, you’ll be able to select between one and seven years of loan repayments however, vehicles that are more than two years old might have shorter time frames .
The rates for 12-month loans in May 2025 were tied to KIBOR at 11.16 percent.
You must purchase insurance that is typically included in your monthly expenses at a cost ranging from 1.4 percent and 3.5 percentage.
Eligibility Criteria
Candidates who earn a salary must be between 21 and 65 years old Self-employed applicants could be as old as 70 .
Earnings: PKR 40,000 – 150,000 per month is your minimum wage, contingent upon how you work.
For each one of these you’ll have to provide your CNIC and evidence of income such as bank statements or salary slips, and proof of your work or business.
2 The Best Automobile Loan Providers Found in Pakistan for 2025
1. Car Ijarah from Meezan Bank adheres to Islamic rules.
This “Car Ijarah” from Meezan Bank is the country’s only car financing service that is riba-free that operates on the basis of Islamic leasing.
Key Features:
Security Deposit 15% for new cars or as low as that.
The length of the term is 7 years.
Fixed profits are at the minimum rate of 13.45 percent for a single year.
Tax benefits are available to you The banks cover tax withheld when you purchase a car.
Eligible: Accounts are open to residents of the country and Roshan Digital Account users.
If you’re in search of an ethical and non-interest loan This is the perfect option for you.
2. It is also known under the designation Dubai Islamic Bank (DIBPL)
DIBPL offers the most Shariah-compliant auto loans on the market.
What you can spend 85 percent of the value of your vehicle.
The time span was between 1 and 7 years.
Markup Rates The markup rate is among the cheapest rates available as well as no need to make advance deposits.
In the case of insurance, you generally have lower rates than traditional banks.
Perfect if you require to finance an import or used vehicle. Many banks won’t consider these purchases.
3. Auto Loan & Roshan Apni Car from Bank Alfalah
Bank Alfalah has designed two products to meet the specific needs of customers.
Standard Auto Loan.
In this way, a significant portion of the principal will be put aside for the final balloon payments, reducing the amount of your monthly installments .
Cars with engines that are greater than 1000cc are expected to get 3 to 5 years of warranty.
For those who have Roshan Digital Accounts the markup for loans is 1 year KIBOR plus 1percent .
Roshan Apni Car provides overseas Pakistanis loan financing, letting them purchase a vehicle without having to put down any equity.
Anyone who has a high-income or who live in other countries and want flexible arrangements should think about this service.
4. Allied Bank – Allied Car Finance
The ease and simplicity in the operation of Allied Bank is what shine.
You must make an initial minimum down payment of 30 percent.
The rate of interest for those earning salary will be KIBOR plus 3% to be put into place within the initial 12 months following the application.
The term of this job could be between 1 and 5 years.
Extra information: You won’t be billed for rejected applications.
The first time borrowers who earn a mid-income will find this the most beneficial.
5. Habib Metro Auto Finance is the company that finances the purchase of Metro Auto models.
Habib Metro offers passengers both speed and efficiency at a low cost.
The maximum amount for loans is PKR 3 million.
The tenure of the job is not longer than five years.
Insurance coverage is provided with the most well-known companies.
The charges will not be pursued within the two years following settlement.
Good for: Those who would like their money to be processed swiftly and with easy phrases.
3. Alternative finance plans are accessible in Islam.
Anyone concerned about ethical issues when borrowing can look for Musharakah (profit-sharing) as well as Ijarah (leasing) through Islamic banks.
Meezan Bank’s Ijarah gives the vehicle to the customer to use, and then transfer ownership once the tenure is over.
In Dubai Islamic Bank, assets are transferred to investors who use decreasing Musharakah which means ownership changes slowly.
One of the main advantages of such investment is that it requires no charges (riba) which is accepted in accordance with Shariah principles.
4. Answers to Questions about Differences in Interest Rates
Bank Markup Profit Rate Tenure Down Payment
Meezan Bank 13.45%-24.49% 1-7 years 15-35%
Bank Alfalah KIBOR + 1%-5% 3-7 years 15-20%
Allied Bank KIBOR + 3%-4.5% 1-5 years 30%
Faysal Bank 14.64% (fixed) 1-5 years 10-30 percent
HBL 15.64 1-5 years 35 percent
The price you pay for your car is based on your credit score as well as the kind of car you’re looking for.
5. Things You Should Know to Pick the Appropriate Car Loan
1. Don’t forget Credit Processing Costs, Premium Fees, and markup when you are comparing your total costs. For instance, HBL charges you PKR 12,000 while Meezan doesn’t.
2. Be aware of KIBOR rates The floating rates can go either way once a year, and may alter the much you are charged over the course of time .
3. If you are able to negotiate longer durations the monthly payment will decrease however the total amount of interest you have to pay rises. Calculators such as those on PakWheels are recommended to test various scenarios.
4. Verify eligibility at the beginning The minimum requirement for salaried workers is minimum two years in the same employer, and self-employed workers must be in business for a minimum of three years.
5. Check for financial structures that have been endorsed by Islam so that you do not Make Use of Riba But Still Benefit from tax exemptions for cars.
6. Unique Loan Programs
Suzuki Finance Arrangement Program gives you priority in receiving your vehicle, low-cost insurance, and permits online applications for their vehicles.
Roshan Apni Car This policy is only for foreigners who require a an auto lien and earning US dollars .
7. Breaking AI initiatives are readily accessible and available.
There are a few additional charges like the cost of installing the tracker, or cancellation fees if you cancel your contract earlier at these financial institutions.
Pay Attention to your EMI in relation to your Income Do not allow EMI payments account for more than 40 percent of your monthly income .
A high CIB Defaults score will not be a good thing for your loan application, so make sure you meet these hurdles prior to submitting .
Conclusion
When it comes to deciding on the right car loan, your finances, the vehicle you’d like to buy and your personal values are crucial. Customers who are concerned about Shariah law may choose Meezan’s Ijarah option as well as Bank Alfalah’s remaining value plans provide customers with more flexibility. Utilize the Car Loan Calculator on PakWheels and talk to an agent from the bank to determine an option that meets your financial needs.
If you don’t submit income tax returns Meezan Bank’s rules apply to the price of your car subject to a 4 percent upfront tax . Make sure you are aware of the rules prepare ahead, and you will feel secure when you drive your brand new vehicle to your home.
For full details you can visit your bank’s website or call an advisor in the field. The rates and terms may change in the future; you should make sure you are aware of any changes prior to making any decisions.