Car financing in Pakistan is available through commercial banks, Meezan Bank's Islamic auto financing, and NBFC leasing companies — with markup rates typically 18–25% per annum. This calculator shows monthly instalments, total markup paid, and total cost for any vehicle price and down payment combination.
How to use: Enter the car price, your down payment, the bank's annual markup rate, and the financing tenure. Banks typically finance 70–80% of vehicle value — the remaining 20–30% is your required down payment. The calculator assumes reducing balance calculation method.
Calculate your monthly car loan instalment and total financing cost including bank markup.
Actual bank rates vary. Banks typically finance 70-80% of vehicle value (20-30% minimum down payment). Processing fees and insurance are additional costs not included here.
Beyond the Monthly Instalment
Total markup paid over the full tenure is often 50–80% of the vehicle's purchase price on a 5-year loan at current Pakistani rates. A Rs. 4,000,000 car financed at 22% for 5 years costs approximately Rs. 2,600,000 in markup — effectively paying Rs. 6,600,000 for a Rs. 4,000,000 car. Maximising your down payment and minimising tenure significantly reduces this markup cost.
Frequently Asked Questions
Rates vary by bank and change frequently with the SBP policy rate. As of 2026, rates are broadly similar across major banks at 18–24%. Meezan Bank's Diminishing Musharakah auto product is competitive for Islamic financing. Compare by getting multiple quotes rather than relying on advertised rates — processing fees, insurance requirements, and prepayment terms also matter.
Yes — banks require comprehensive insurance throughout the financing period (not just third-party). Comprehensive insurance costs 2–4% of the vehicle value per year. On a Rs. 4,000,000 car, that's Rs. 80,000–160,000 per year in insurance — an often-overlooked cost of financed car ownership.
Car loan refinancing is not common in Pakistan's banking market. Most borrowers continue with the original loan until maturity. If you have a floating-rate loan, the rate adjusts automatically at reset dates without refinancing. Prepaying a high-rate loan (with the applicable prepayment fee) may be more accessible than refinancing.