Waris and Reena Masih from Faisalabad borrowed 40,000 rupees from a local lender to pay for home repairs and the arrival of their baby daughter.
When they were unable to keep up with the interest payments, a gunman reportedly visited their home.
It's claimed he started firing at Waris from afar but ended up hitting daughter Myra, aged six, in the head and the shin.
Masih says, after rushing to seek medical treatment, he was turned away by one hospital and it was too late by the time they arrived at the second.
Speaking about her loss, Reena said: "I cannot express the pain.
"I feel deeply depressed and find it hard to carry on.
"I feel as if I have failed my daughter.
"It is my responsibility to my remaining children and my husband that keeps me going and the knowledge that God is now caring for my daughter in heaven where one day I will see her again and ask her to forgive me.
"I will cry and mourn my daughter every day till the day I am reunited - she will never be forgotten."
Wilson Chowdhry, Chairman of the British Pakistani Christian Association (BPCA), said: "Living in Pakistan as a Christian is in most cases a gruesome ordeal, you live life on the margins, are severely discriminated against and persecution is only around the corner.
"Incidents like this gory tale of a young child being murdered to compensate for a missed payment on a loan shark agreement, are sadly common-place.
"Worse still, such crimes rarely result in a prosecution as perpetrators without any compunction, are able to buy themselves out of justice using the Qisas and Diyat laws to avert proper punishment.
The BPCA has provided funds for a funeral while it is looking to provide legal assistance in an attempt to bring about justice.