Here’s How You Can Get Interest-Free Car Loan from Meezan Bank

Meezan Bank’s Car Ijarah is Pakistan’s first interest-free car financing solution, which operates on the principles of Islamic financing. It is designed for individuals who wish to acquire locally manufactured/assembled vehicles without paying interest.

Under Car Ijarah, the bank and the customer enter into a car rental agreement where the bank purchases the vehicle and rents it out to the customer for a period of 1 to 5 years, as agreed upon in the contract. At the end of the Ijarah period, the vehicle is either sold at a nominal amount or gifted to the customer.

This financing product is an excellent option for individuals who want to purchase a car but cannot afford to pay the full amount upfront. It provides a transparent and Shariah-compliant financing option that does not involve any interest-based transactions.

Features:

Meezan Bank’s Car Ijarah, Pakistan’s first interest-free car financing solution, offers the following key features:

1. Shariah-compliant financing: Car Ijarah operates on the principles of Islamic financing and is a Shariah-compliant financing option.
2. Interest-free financing: Customers can acquire locally manufactured/assembled vehicles without paying any interest on the financing amount.
3. Flexible financing terms: Meezan Bank’s Car Ijarah offers flexible financing terms, allowing customers to choose a repayment period of 1 to 7 years, depending on their financial capacity.
4. No hidden charges: There are no hidden charges involved in Car Ijarah financing. All fees and charges are clearly disclosed at the time of the contract.
5. Ownership transfer: At the end of the Ijarah period, the customer can either purchase the vehicle at a nominal amount or gift it to someone else.
6. Hassle-free financing: The financing process is simple, fast, and hassle-free. Customers can apply online, and the bank’s representatives will guide them through the process.
7. Wide range of vehicles: Meezan Bank’s Car Ijarah offers financing for a wide range of locally manufactured/assembled vehicles, including cars, SUVs, and pickups.

Eligibility Criteria:

The following are the key points regarding the financing facility offered for new locally assembled and Complete Built Up (CBU) vehicles:

1. Security deposit / Advance rental: The applicant is required to pay a minimum of 15% and a maximum of 50% of the cost of the vehicle as a security deposit or advance rental.
2. Credit history check: The applicant’s credit history will be checked through both data check and e-CIB, and there should be no default or overdue payments at the time of case approval.
3. Available for Roshan Digital Account holders: This facility is available for all Roshan Digital Account holders, including foreign currency account holders.
4. No processing charges: There are no processing charges, but the applicant must pay documentation and security perfection charges at the time of disbursement.
5. Monthly rentals: Monthly rentals will be paid through direct debit instructions from the PKR Roshan Digital Account.
6. Vehicle delivery: The vehicle will be delivered to the nominee or co-borrower, who must be a blood relative of the applicant, such as father/mother, son/daughter, brother/sister, or spouse residing in Pakistan.
7. Age limit of nominee / co-borrower: The authorized nominee or co-borrower should not be above the age of 70 years at the time of Ijarah maturity.
8. Advance Tax: In case of a non-filer, 4% Advance Tax on the Cost of Vehicle will be applicable at the time of vehicle disbursement.
9. Age limit of applicant: The applicant must be at least 25 years old, and the maximum age limit at the time of maturity is 60 years for salaried professionals and 65 years for businessmen/self-employed professionals.
10. Employment/business history: The applicant must have a minimum of 2 years of continuous employment history in their current job for salaried professionals and a minimum of 3 years of continuous involvement in their current business/industry for businessmen/self-employed professionals.
11. Debt-to-income ratio: If the applicant has availed other financing facilities, the combined monthly repayments, including proposed Ijarah rental, should not exceed 40% of their net/take-home income.

Product Profit Rates*

*Above mentioned profit rates are without Takaful and Tracker

Takaful Rates

Required Documents:

For salaried individuals, the following documents are required to apply for Meezan Bank’s car financing under the Car Ijarah product:

• An employment certificate with the date of joining
• Bank statements showing the credited salary for the last six months
• A copy of the nominee’s CNIC
• The name and mailing address of the HR representative of the employer
• A credit bureau report from the stay country

For businessmen, the following documents are required:

• Valid proof of business
• Verified bank statements for the last six months through embassy
• A copy of the nominee’s CNIC
• A credit bureau report from the stay country

In the case of remittances income, the last six months’ bank statements of the remitter would also be required.