๐จ๐ฝ๐ฑ๐ฎ๐๐ฒ๐ ๐ณ๐ฟ๐ผ๐บ ๐ฆ๐๐ฎ๐๐ฒ ๐๐ฎ๐ป๐ธ ๐ข๐ณ ๐ฃ๐ฎ๐ธ๐ถ๐๐๐ฎ๐ป โ ๐๐๐๐ผ ๐๐ถ๐ป๐ฎ๐ป๐ฐ๐ถ๐ป๐ด โ
State of Bank has announced new/ revised Prudential Regulations for Consumer Financing (PRCF) . Below are some salient features related to Auto loans.
The total monthly amortization payments of consumer financing facilities, as prescribed in paragraph 1 of the regulation, should not exceed 40% of the net disposal income of the prospective borrower. Similarly, in paragraph 3 of the regulation Debt Burden Ratio for Consumer Financing may be read as 40 percent instead of 50 percent.
The maximum tenure of the auto finance facility is reduced from seven (7) years to five (5) years.
The minimum down payment is increased from 15 percent to 30 percent of the value of vehicle.
Overall auto loans/financing limits availed by one person from all banks/DFIs, in aggregate, shall not exceed Rs3,000,000/-, at any point in time. However, the financing limit of borrowers whose approved limit already exceeds Rs3,000,000/- may be amortized as per existing terms and the same shall not be further increased.
๐ก๐ฒ๐ ๐ฎ๐ ๐๐ฒ๐น๐น ๐ฎ๐ ๐๐๐ฒ๐ฑ ๐ถ๐บ๐ฝ๐ผ๐ฟ๐๐ฒ๐ฑ shall not be eligible for auto financing from banks/DFIs.
The aforesaid amendments in PRCF will not apply on ;
Financing for locally assembled/manufactured vehicles of up-to 1000cc engine capacity.
Roshan Apni Car product of banks and
Locally assembled/manufactured Electric Vehicles. Accordingly, these financings will continue to be governed by PRCF existing prior to these amendments. Besides, the regulatory treatment of Roshan Apni Car product already communicated to RDA participant banks will continue to remain effective.
The above amendments in PRCF shall be applicable, with immediate effect, on new financing facilities. All other instructions on the subject shall, however, remain unchanged.
SOURCE: https://www.sbp.org.pk/bprd/2021/CL29.htm
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