The attack was claimed on Twitter by a spokesman for the Baloch Nationalist Army, one of several ethnic separatist groups that have been waging an insurgency for years in southwest Pakistan.
"Initial investigations show that it was a time-controlled device on a motorbike which was the cause of the blast," Rana Arif, spokesman for Lahore police, told AFP.
Thursday's blast happened in old Lahore's busy Anarkali shopping district, damaging several motorbikes and upturning market stalls.
Officials said a nine-year-old child was one of those killed.
Pakistani Prime Minister Imran Khan expressed regret over the "loss of precious human lives", a spokesman for his office said.
On Twitter, a spokesman for the Baloch Nationalist Army said it was responsible.
"This attack targeted bank employees. A detailed statement will be issued soon," the tweet said.