Car installment calculator Pakistan
Enter the car price, the down payment and the bank's rate, and see the monthly installment, the cost with insurance and what the car costs in total.
Results
Monthly installment
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Principal and interest, the same each month at the rate entered.
- Monthly installment
- 0.00
- Monthly cost with insurance
- 0.00
- Amount financed
- 0.00
- Down payment
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- Rate
- -
- Insurance a year
- 0.00
- Total interest
- 0.00
- Total cost of the car
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- Number of installments
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- Last installment
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| Month | Date | Installment | Principal | Interest | Balance |
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For information only, not financial, tax or legal advice.
Last updated 2026-11-01. Method checked 2026-11-01. Methodology
Banks in Pakistan price car financing at KIBOR, the Karachi Interbank Offered Rate, plus a spread, or at a fixed rate for the whole tenor. Enter the price of the car, the down payment as a percent or an amount, the rate and the tenor in years. Add the yearly insurance as a percent of the car's price and the one time processing fee from the bank's quote. The calculator shows the monthly installment, the monthly cost once insurance is added, the interest, the total cost and a schedule you can copy as CSV. It also says when the inputs fall outside the State Bank's auto finance rules, without changing a figure. KIBOR moves, and a variable rate is reset on dates the agreement sets. The tool holds the rate you enter for the whole tenor. Every sum is worked out on this page, and the amounts stay in this browser.
How to use the Car Installment Calculator
- Enter the car price and the down payment, as a percent of the price or as an amount.
- Choose KIBOR plus spread and enter both, or choose a fixed rate. Tip: The bank's offer letter names the KIBOR it uses and the spread above it.
- Enter the tenor in whole years and pick the engine size of the car.
- Enter the insurance rate a year and the processing fee from the bank's quote.
- Read the installment, the monthly cost with insurance, the total cost and the schedule.
Worked example
A locally made car of up to 1,000cc on bank finance at KIBOR plus a spread, where 11% is an example KIBOR. All figures are PKR.
| Input | Value |
|---|---|
| Car price | PKR 3,500,000.00 |
| Down payment | 30% of the price |
| Rate | KIBOR 11% plus a 3% spread |
| Tenor | 5 years, 60 installments |
| Insurance and fee | 1.5% a year and PKR 10,000.00 once |
Down payment = 3,500,000 x 30% = PKR 1,050,000.00, so A = PKR 2,450,000.00 is financed Rate = 11% + 3% = 14% a year, r = 14% / 12 = 0.011667, n = 60, (1 + r)^60 = 2.005610 Installment = 2,450,000 x 0.011667 x 2.005610 / 1.005610 = PKR 57,007.21 Insurance = 3,500,000 x 1.5% = PKR 52,500.00 a year, PKR 4,375.00 a month, so the monthly cost is PKR 61,382.21 59 installments of 57,007.21 and a last one of 57,007.59 repay the loan with PKR 970,432.98 of interest Total cost = 1,050,000 + 3,420,432.98 + 262,500 + 10,000 = PKR 4,742,932.98
- Monthly installment
- PKR 57,007.21
- Monthly cost with insurance
- PKR 61,382.21
- Amount financed
- PKR 2,450,000.00
- Total interest
- PKR 970,432.98
- Total cost of the car
- PKR 4,742,932.98
Interest is rounded to the paisa each month, so the last installment is PKR 0.38 more than the others and the balance ends at exactly 0. The loan and EMI calculator gives the same PKR 57,007.21 for 2,450,000 at 14% over 5 years.
How the car installment is calculated
Amount financed A = price - down payment
Yearly rate = KIBOR + spread, or the fixed rate, and r = yearly rate / 12
Installment M = A x r x (1 + r)^n / ((1 + r)^n - 1), with n = tenor in years x 12
Total cost = down payment + every installment + yearly insurance x years + processing fee
The down payment is a percent of the price or a fixed amount, and the rest is financed. The installment is the standard reducing balance payment, rounded to the paisa, the same one the loan and EMI calculator uses. Each month the interest is the balance owed times r, rounded to the paisa, and the rest of the installment reduces the balance. The last installment absorbs the rounding so the balance ends at 0.
With KIBOR plus spread the two are added to give one yearly rate. A variable rate loan is reset to the current KIBOR on dates the agreement sets, so the schedule is right only while the rate holds. The fixed rate option keeps one rate for every month of the tenor.
Insurance is a percent of the car's price each year, rounded once. The monthly cost adds a twelfth of that premium to the installment. Over the tenor the calculator counts the full premium for each year. If the insurer values the car lower in later years the real premium falls, and the figure here does not model that. The processing fee is paid once and enters only the total cost.
The State Bank of Pakistan sets limits for bank auto loans in its Prudential Regulations for Consumer Financing. BPRD Circular Letter No. 29 of 23 September 2021 raised the minimum down payment to 30% of the vehicle's value, capped auto financing at PKR 3,000,000 per person across all banks and made imported vehicles ineligible. Circular Letter No. 19 of 24 May 2022 cut the longest tenor to 3 years above 1,000cc and to 5 years up to 1,000cc, and applied the 2021 changes to cars of up to 1,000cc too. Both texts were read on sbp.org.pk on 1 November 2026, through the archived copy of 19 June 2025 because the site refused scripted requests. When the inputs fall outside these limits the calculator shows a note and still works out the loan as entered, because a bank applies the rules in force on the day it approves the financing.
Not modeled: the withholding tax and registration charged when the car is registered, the bank's late payment charges, and an Islamic car ijarah, where rent takes the place of interest.
Frequently asked questions
How is a car installment worked out in Pakistan?
The bank finances the price less your down payment and charges interest each month on the balance still owed, the reducing balance method. On a PKR 3,500,000 car with 30% down, PKR 2,450,000 is financed. At KIBOR 11% plus a 3% spread, 14% a year over 5 years, the installment is PKR 57,007.21 a month and the interest over the tenor is PKR 970,432.98.
What are the State Bank's rules for car financing?
The State Bank's Prudential Regulations for Consumer Financing, as amended in September 2021 and May 2022, set a minimum down payment of 30% of the vehicle's value. The longest tenor is 3 years for a car above 1,000cc and 5 years up to 1,000cc, and one person may hold at most PKR 3,000,000 of auto financing across all banks. Imported vehicles are not eligible. The calculator flags these limits but never applies them.
What is KIBOR and why can the installment change?
KIBOR is the Karachi Interbank Offered Rate, the benchmark Pakistani banks use to price variable rate car loans. On such a loan the rate is reset to the KIBOR of the day plus the agreed spread on dates the financing agreement sets, so the installment rises or falls with it. The calculator holds the rate you enter for the whole tenor, so a reset needs a new run with the new KIBOR.
Is car insurance part of the installment?
Insurance on a financed car is quoted as a percent of the car's value each year and is paid on top of the installment. The calculator adds a twelfth of the yearly premium to the installment to give the monthly cost, and counts the premium for every year of the tenor in the total cost. At 1.5% on a PKR 3,500,000 car that is PKR 52,500 a year, or PKR 4,375 a month.
Does a bigger down payment lower the total cost?
Yes. Every rupee paid at the start is a rupee the bank charges no interest on. On the example car at 14% over 5 years, raising the down payment from 30% to 50% cuts the amount financed to PKR 1,750,000, the installment to PKR 40,719.44 and the interest to PKR 693,166.30. The insurance and the fee stay the same, because both depend on the price and not on the loan.
Guides for this tool
Sources
- State Bank of Pakistan: BPRD Circular Letter No. 29 of 2021 (minimum down payment 30%, PKR 3,000,000 limit, imported vehicles), read through the Wayback Machine copy of 19 June 2025 checked 2026-11-01
- State Bank of Pakistan: BPRD Circular Letter No. 19 of 2022 (maximum tenor 3 years above 1,000cc and 5 years up to 1,000cc), read through the Wayback Machine copy of 19 June 2025 checked 2026-11-01