Purpose: This loan finance purchase of cars / two-wheelers, new as well as old second-hand vehicles less than 3 years old.
Eligibility: Any Individual, Proprietary/Partnership concerns as well as Limited Companies are eligible to avail finance under the vehicle loan scheme; provided they have adequate repayment capacity.
Rate of Interest: The interest is charged on daily product basis. The interest rate of car loan / two-wheeler loan for personal use is 11% and for commercial purpose is 13.5%. In case of loans for auto/ taxi driven by owner, the rate of interest is 12% for loans up to Rs. 2 lakhs and 12.5% for loans above Rs. 2 lakhs.
Margin: There is a margin of 25%.
Repayment: The repayment period is 5 years for new vehicles and 3 years for second hand vehicles. The repayment has to be done in equated monthly installments.
Security & Guarantee:
- Hypothecation of vehicle purchased with the loan amount.
- Comprehensive Insurance policy of the vehicle with bank’s clause.
- Sureties of the persons acceptable to the Bank.
- The borrower / guarantors have to become members of the bank and they must acquire requisite shareholding of the bank as per rule.