Islamabad: Bike financing is emerging as a popular trend among Pakistanis, driven by improved security conditions and historically low interest rates, which have prompted banks to vie for customers in this growing market. This shift is particularly notable as financial institutions have traditionally been hesitant to provide loans to non-corporate and non-government individuals for purchases like motorcycles.

According to JS Bank Limited, the resurgence in motorcycle sales, which recently hit a record of 1.91 million units, up from around 1.7 million over a decade ago, has captured the interest of several banks. The introduction of higher-quality motorcycles such as the Suzuki 150cc, Yamaha YBR125, and Honda CG125, priced between Rs 135,000 to Rs 140,000, has also contributed to the increasing attractiveness of bike financing options.

MBL, among other banks, has relaunched its Bike Ijarah program specifically targeting the working middle class in urban areas where motorcycles are a fundamental necessity. Since December 2015, partnerships with major motorcycle manufacturers like Pak Suzuki and Atlas Honda have been established, and discussions with Yamaha are nearing completion, highlighting a significant focus on financing motorcycles as a viable business strategy.

Furthermore, the rise in bike financing is supported by innovative offerings from other financial institutions like JS Bank, which has introduced installment-based financing for both electric and traditional motorcycles, making it easier for consumers to afford their own vehicles.

The motorcycle industry in Pakistan is primarily dominated by Japanese manufacturers, which banks prefer to work with due to their established business structures as opposed to smaller, informal Chinese assemblers. This trend underscores a broader shift towards organized market players, enhancing the reliability and appeal of bike financing.