The State Bank of Pakistan (SBP) has revised Prudential Regulations (PRS) for Consumer Financing. According to a statement issued on Thursday, this step will help moderate demand growth in the economy, leading to slower import growth and lending support to the balance of payments. “The changes in the Prudential Regulations effectively prohibit financing for imported vehicles,” it said. “Moreover, it tightens regulatory requirements for financing of domestically manufactured/ assembled vehicles of engine capacity of over 1,000cc and other consumer finance facilities like personal loans and credit cards.” According to the statement, the maximum tenure of auto financing has been reduced from seven to five years. Moreover, the maximum tenure of personal loan has been reduced from five to four years.
Published in The Express Tribune, September 24th, 2021.
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