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Maximum Loan-to-Value (LTV) Ratios
Comparison of maximum loan percentages allowed for vehicle purchases.
Primary Sources
CBSL tightens Loan-to-Value ratios for vehicle loans from today
The Central Bank of Sri Lanka (CBSL) states that the decision to limit Loan-to-Value (LTV) ratios for motor vehicles has come into effect from today (25). The Governing Board of the CBSL has tightened the maximum Loan-to-Value (LTV) ratios applicable to credit facilities granted for motor vehicles and has also introduced a maximum LTV ratio for credit facilities secured by gold, effective from today (25). These measures were taken by the CBSL in line with its macroprudential authority to promote prudent lending practices, safeguard the resilience of financial institutions, and mitigate the potential build-up of systemic vulnerabilities, the Central Bank said in a statement. The CBSL noted that, in arriving at these decisions, the Governing Board considered the recent significant growth in credit extended through facilities secured by gold and motor vehicle financing, as well as the potential impact on the financial system if such trends continue at the current pace. It added that heightened uncertainties stemming from evolving geopolitical and geoeconomic developments have increased volatility in asset prices, including gold, alongside recent exchange rate fluctuations. “The temporary increase in the surcharge on vehicle imports and exchange rate movements could temporarily inflate vehicle prices. Such fluctuations may affect collateral valuations and alter the underlying credit risk profiles, while continued rapid credit expansion warrants intervention to prevent a potential build-up of excessive risks within the financial system,” the CBSL noted. Accordingly, a maximum LTV ratio of 70% has been introduced for credit facilities secured by gold collateral granted by Licensed Banks and Licensed Finance Companies, including existing credit facilities that are renewed on or after the effective date. Moreover, the existing maximum LTV limits applicable to credit facilities granted for motor vehicles have been tightened by 10 percentage points. Accordingly, from today (25), the CBSL will impose the following maximum LTV ratios on vehicle loans for unregistered vehicles and vehicles used in Sri Lanka for less than one year after first registration: • 60% for commercial vehicles • 40% for cars, SUVs, vans, three-wheelers, and other vehicles.
CBSL tightens Loan to Value ratio for credit granted for vehicles
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Sri Lanka tightens vehicle loan limits again - Sri Lanka
Posted by ONLANKA Newsroom on May 25, 2026 - 9:18 am AI-generated image The Central Bank of Sri Lanka says its decision to further reduce maximum loan values for motor vehicles has come into effect from today (May 25), lowering the loan limit for commercial vehicles to 60% and personal vehicles to 40%. Under the new limits, the maximum loan-to-value ratio for commercial vehicles has been reduced from 70% to 60%, meaning buyers can now obtain loans covering only up to 60% of a vehicle’s value. The Central Bank has also reduced the maximum loan limit for personal vehicles, including motor cars, SUVs, vans, and three-wheelers, from 50% to 40%. The CBSL had previously revised vehicle loan limits several times in 2025 amid prevailing economic conditions. From July 17, 2025, the maximum loan limits were set at 80% for commercial vehicles and 60% for motor cars and vans. Later, on November 7, 2025, the Central Bank further reduced the limits to 70% for commercial vehicles and 50% for motor cars, vans, three-wheelers, and other vehicles. With the latest revision effective from today, the maximum loan limit for commercial vehicles has now been reduced to 60%, while the limit for motor cars, vans, three-wheelers, and other vehicles has been lowered to 40%.
The Central Bank of Sri Lanka (CBSL) introduces a maximum Loan to Value ...
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