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Central Bank Revises Vehicle Loan Limits with New LTV Ratios
Aruna Shantha
18-Jul-2025 17:16:23
The Central Bank of Sri Lanka has issued a new directive revising loan-to-value (LTV) ratios for vehicle financing, effective from July 17, 2025. The directive, issued under the Central Bank Act, aims to strengthen macroprudential policymaking and reduce systemic financial risks.
Key changes include the removal of the 90% LTV cap for electric vehicles and an increase in the LTV ratio for cars, SUVs, and vans from 50% to 60%. For three-wheelers, the LTV ratio has been doubled from 25% to 50%.
Vehicles used for taxi or similar commercial services are now subject to a 70% LTV limit. Meanwhile, the ratio for commercial vehicles has been reduced from 90% to 80%. Additionally, cars registered and used in Sri Lanka for over a year now face a 70% LTV cap.
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