What is the personal loan interest rate in Pakistan?

Typically 18–28% per year in 2026: 1-year KIBOR plus the bank's spread, lower for salaried employees of approved companies and for customers who transfer their salary account.

How much personal loan can I get?

Banks usually lend up to 10–20 times net monthly salary, capped by SBP's debt-burden rule that total instalments stay under about 50% of net income.

Is early repayment allowed?

Yes, usually with a 2–5% early settlement charge on the outstanding balance; some banks waive it after half the tenure.

Islamic personal finance: is it the same calculation?

The instalment maths is the same; the structure is a sale (murabaha) or service (ijarah/tawarruq) with a fixed profit rate instead of interest.

Financev1.0.0Last reviewed 15 Sept 2026

Personal Loan Calculator Pakistan

Monthly instalment and total mark-up on a personal or salary loan in Pakistan for any amount, rate and tenure, with the year-by-year balance so you can see how much is interest.

Monthly instalmentRs 38,731

Pre-filled from Searchable Data: 1-year KIBOR + 10% spread 23.04 (30 Oct). Rates last reviewed 15 Sept 2026. How this is calculated

Borrowing Rs 1,000,000 at 23% over 3 years costs Rs 38,731 a month. You repay Rs 1,394,301 in total, Rs 394,301 in mark-up plus Rs 10,000 processing fee. Effective cost: 40.4% of the amount borrowed.

Cost of the loan

Amount borrowed: Rs 1,000,000
Total mark-up (23% p.a.): Rs 394,301
Processing fee (upfront): Rs 10,000
Total repaid: Rs 1,404,301
Net cash you receive: Rs 990,000

Balance over time

After year 1: Rs 739,229 left · Rs 203,996 mark-up paid
After year 2: Rs 411,609 left · Rs 137,146 mark-up paid
After year 3: Rs 0 left · Rs 53,158 mark-up paid

Warning: Banks price personal loans on KIBOR plus a spread and may reprice annually; the instalment can rise if KIBOR does. Late-payment charges and life insurance are extra.

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How this is calculated

Instalment = P × r ÷ (1 − (1 + r)^−n), where P is the amount, r the monthly rate (annual ÷ 12) and n the number of months, the standard reducing-balance formula used by Pakistani banks for personal, salary and Islamic personal finance (where the "profit rate" plays the same role).

Unsecured personal loans in 2026 are priced at 1-year KIBOR (~12.3%) plus 8–14% depending on employer category and salary-transfer status, with a 1–2% processing fee plus FED deducted upfront. The year-by-year table shows how mark-up front-loads: most of the early instalments are interest.

Frequently asked questions

What is the personal loan interest rate in Pakistan?: Typically 18–28% per year in 2026: 1-year KIBOR plus the bank's spread, lower for salaried employees of approved companies and for customers who transfer their salary account.
How much personal loan can I get?: Banks usually lend up to 10–20 times net monthly salary, capped by SBP's debt-burden rule that total instalments stay under about 50% of net income.
Is early repayment allowed?: Yes, usually with a 2–5% early settlement charge on the outstanding balance; some banks waive it after half the tenure.
Islamic personal finance: is it the same calculation?: The instalment maths is the same; the structure is a sale (murabaha) or service (ijarah/tawarruq) with a fixed profit rate instead of interest.

Sources

State Bank of Pakistan: KIBOR and consumer financing regulations: State Bank of Pakistan

Version 1.0.0 · reviewed 15 Sept 2026. Rates change with the Federal Budget and regulator notifications; we update this tool when they do. Confirm with the primary source before making financial decisions.

Topics:HBL Meezan Bank State Bank of Pakistan