What is the 60% LTV cap on motor vehicles in Sri Lanka?
A regulatory cap on motor-vehicle loans set by the Central Bank of Sri Lanka effective July 2025. Banks and NBFIs can finance up to 60% of the vehicle's landed value, requiring a minimum 40% cash down payment from the buyer.
Also known as: 60% LTV, loan-to-value cap, CBSL LTV directive
What is the 60% LTV cap on motor vehicles?
The 60% Loan-to-Value (LTV) cap is a regulatory directive issued by the Central Bank of Sri Lanka (CBSL Direction No. 04 of 2025), effective July 2025. It restricts banks and Non-Bank Financial Institutions (NBFIs) from financing more than 60% of the landed value of a motor car.
What it means for buyers
- Minimum cash down payment: 40% of the landed price
- Maximum financed: 60% of the landed price
- Applies to: all motor-car leases and hire-purchase agreements granted on or after July 2025
- Exceptions: none for personal-use motor cars; commercial vehicles have separate (slightly more permissive) rules
Practical example
A Honda Vezel landed at LKR 12.8M:
- Down payment: LKR 5.12M (40%)
- Financed: LKR 7.68M (60%)
- Monthly payment (7-year tenure at 13.5% APR): ~LKR 142,000
Why the cap exists
CBSL introduced the cap as part of macroprudential measures responding to the demand surge that followed the February 2025 reopening of vehicle imports. The objective is to dampen credit-driven import demand and stabilize the LKR exchange rate.
How Car Dreams works around it
Every detail page on cardreams.lk surfaces the standard “40% down · 7-year lease at 13.5% APR” panel as the realistic financing scenario for most buyers. Our nine NBFI partners — LOLC, LB Finance, People’s Leasing, HNB, Commercial Bank, Sampath, DFCC, Pan Asia and Seylan — all operate within the 60% cap. We help with pre-qualification before you commit to a car.
Related terms
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NBFI
Non-Bank Financial Institution — leasing and finance companies that provide motor-vehicle credit alongside or instead of banks. NBFIs hold the majority of Sri Lankan motor-vehicle leases. Major players include LOLC, LB Finance, People's Leasing, Pan Asia Bank and Seylan.
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CBSL
The Central Bank of Sri Lanka — the regulator setting macroprudential rules for vehicle financing. CBSL's July 2025 directive capped motor-vehicle loans at 60% loan-to-value, requiring buyers to pay a minimum 40% cash down payment.
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