# The SBP policy rate explained: what 11% means for your car loan, mortgage and savings

Source: Searchable (https://searchable.pk/news/economy/sbp-policy-rate-explained-what-11-percent-means-for-loans-and-savings)
Type: News article
Author: Searchable Editorial
Published: 11 Sept 2026
Updated: 15 Sept 2026
Retrieved: 15 Sept 2026

> The policy rate anchors KIBOR, which sets the price of almost every loan in Pakistan. Here is how a change flows through to instalments and deposit returns.

The State Bank's Monetary Policy Committee sets the **policy rate** roughly every six to eight weeks. Banks price loans off **KIBOR**, the interbank rate, which tracks the policy rate closely.

## Loans

A car loan is typically priced at 1-year KIBOR + 2–4%. At an 11% policy rate, that puts most car financing at 13–15%. On a Rs 3 million loan over five years, each 1% change in the rate moves the monthly instalment by about Rs 1,500. Model it with the [Car Loan Calculator](/tools/cars/car-loan-calculator).

Home finance is similar but longer, a 1% change on a 20-year Rs 10 million mortgage is roughly Rs 6,500 a month.

## Savings

Bank savings accounts must pay at least the policy rate minus a spread on PLS deposits. National Savings and Naya Pakistan Certificates re-price with a lag.

## What to watch

Inflation prints (monthly CPI), the rupee, and the IMF programme reviews shape the committee's decisions. Searchable tracks the rate history on the [SBP hub](/e/sbp).

## Sources

- SBP: Monetary Policy Decisions (State Bank of Pakistan): https://www.sbp.org.pk

How to cite: "The SBP policy rate explained: what 11% means for your car loan, mortgage and savings", Searchable, 15 Sept 2026, https://searchable.pk/news/economy/sbp-policy-rate-explained-what-11-percent-means-for-loans-and-savings