Top Banks Car Loan Interest Rates Dec 2019
|Bank||Interest rate (%)||EMI (In||Processing fee|
|Allahabad Bank||8.65% - 10.90%||2,059 - 2,169||0.50% of loan amount (Maximum 8,696)
(Allahabad Bank Employees - NIL)
|Andhra Bank||8.80%||2,066||1% of the loan amount (Minimum 1,000 and Maximum 25,000) + GST|
|Bank of Baroda||8.40% - 10.40%||2,047 - 2,144||Unified Processing Charges for Car Loan is 500 + GST till 31.12.2019|
|Bank of India||8.60% - 9.20%||2,056 - 2,086||Minimum 1,000 and Maximum 5,000|
|Bank of Maharashtra||8.85% - 10.10%||2,069 - 2,130||0.25% of loan amount|
|Canara Bank||8.45% - 11.05%||2,049 - 2,177||0.25% on the loan amount (Minimum 1,000 and Maximum 5,000)|
|Central Bank of India||8.40% - 8.65%||2,047 - 2,059||Up to 500 per proposal|
|Corporation Bank||8.75% - 9.25%||2,064 - 2,088||1% of the loan amount (Minimum 1,000)|
|IDBI Bank Limited||8.85% - 9.45%||2,069 - 2,098||1,000 + applicable taxes per proposal|
|Indian Bank||8.85% - 9.20%||2,069 - 2,086||0.230% on loan amount (Maximum 10,236)|
|Indian Overseas Bank||8.70%||2,061||0.50% (Minimum 500) for loan up to 5 Lakhs and 0.60% (Maximum 10,000) for loan above 5 Lakhs|
|Oriental Bank of Commerce||8.05% - 8.70%||2,030 - 2,061||0.50% of loan amount (Minimum 2,500 and Maximum 7,500) + GST|
|Punjab & Sind Bank||8.70%||2,061||Full waiver of processing charges during the Festival Campaign period|
|Punjab National Bank||8.55% - 9%||2,069 - 2,076||Up to 100 + GST|
|State Bank of India||8.75% - 12%||2,064 - 2,224||NIL till 31.12.2019|
|Syndicate Bank||8.75% - 9.25%||2,064 - 2,088||25,000 to 2 Lakhs: 1.25 per 1,000 (Minimum 125). Above 2 Lakhs: 200 per Lakh|
|UCO Bank||8.60%||2,056||1% of the loan amount (Maximum 1,500)|
|Union Bank of India||8.60% - 8.70%||2,056 - 2,061||0.50% of loan amount (Maximum 15,000) + GST|
|United Bank of India||8.60% - 8.85%||2,056 - 2,069||0.59% of the loan amount (Minimum 600 and Maximum of 11,800)|
|Axis Bank||9.05% - 11.30%||2,078 - 2,189||3,500 - 5,500|
|Catholic Syrian Bank Ltd.||9.90% - 10.75%||2,120 - 2,162||Not available on website|
|City Union Bank Ltd.||14.50%||2,353||1.25% of loan amount, Minimum 700|
|DCB Bank Ltd.||11.02% - 11.89%||2,175 - 2,219||Upto 2% of the loan amount, Minimum 5,000|
|Dhanlaxmi Bank Ltd.||10.20% - 10.80%||2,135 - 2,164||1% of loan amount|
|Federal Bank||9.25%||2,088||1,500 for loan amount upto 5 Lakhs, 2,500 for loan amount above 5 Lakhs|
|HDFC Bank Ltd||8.40% - 14.01%||2,047 - 2,327||0.4% of loan amount, Minimum 3,000 and Maximum 10,000|
|ICICI Bank Ltd.||8.80% - 15%||2,066 - 2,379||3,500 to 8,500, depending on the loan amount|
|IndusInd Bank Ltd||10.65% - 15.50%||2,157 - 2,405||0.50% of loan amount, Minimum 2,500|
|Jammu & Kashmir Bank||10.50%||2,149||0.50% of loan amount, Minimum 500|
|Karnataka Bank Ltd.||9.25% - 11.10%||2,088 - 2,179||0.25% of loan amount, Minimum 250 and Maximum 1,000 + applicable tax|
|Karur Vysya Bank||9.45% - 10.55%||2,098 - 2,152||3,000 for loan upto 10 Lakhs and 7,500 for loan above 10 Lakhs|
|Lakshmi Vilas Bank Ltd.||9.95%||2,122||0.50% of the loan amount, Minimum 1,000 and Maximum 10,000|
|Nainital Bank Ltd.||8.80% - 9.90%||2,066 - 2,120||Waived off|
|RBL Bank||12% - 14%||2,224 - 2,327||1% of loan amount|
|South Indian Bank Ltd.||9.25% - 10%||2,088 - 2,125||1% of the loan amount, Maximum 10,000|
|Tamilnad Mercantile Bank Ltd.||10.35% - 11.60%||2,142 - 2,204||1.00% of limit sanctioned without any maximum cap|
A car is one of the biggest purchases a person make in their lifetime. Most of the times, people don't have enough funds readily available to make such a big purchase. Hence, for this purpose, they need a loan. This car financing facility is known as Car Loan or Auto Loan or Vehicle Loan. Car loan refers to the financial product which allows someone to acquire a car, either new or old. It is the most common method of purchasing a car nowadays as you can buy your dream car when needed and pay off the borrowed money in instalments.
Features of Car Loan
Car loan usually comes with the following features and benefits:
- Loan amount from a minimum of 1 Lakh to up to 100%
- Repayment tenure of 12-84 months
- Availability of Top Up facility
- Quick & easy loan processing and approval
- Funding on insurance facility that covers car insurance cost too
- Car buying assistance
Benefits of Car Loans
- Makes it easy to purchase a car: You can get up to 100% finance for your car on ex-showroom price. You don't have to exhaust your savings or wait long to buy your dream car.
- Flexible tenure: You can choose flexible repayment tenure of up to 7 years to pay off the car loan, depending on your repayment capacity and convenience.
- Loan for purchasing a used car: Many banks also offer a loan for purchasing a used car at a slightly higher rate of interest than a loan for a new car.
- Affordable interest rate: You can negotiate the interest rate on your car loan with your lender if your credit score is excellent and you have a good relationship with the bank.
- No collateral required: As your vehicle itself acts as a security with the financing bank, you don't have to provide any collateral to avail a car loan.
Steps to Take a Car Loan
You can avail a car loan by:
- Visiting the car loan provider in-person
- Submitting an online application through car loan provider's website
- Calling the car loan provider
- Through online lending marketplaces
Top-Up Loan on Your Car Loan
Most of the car loan providers offer a top-up loan facility on your car loan. Under this scheme, you can avail an additional loan amount after repaying your car loan successfully for a specific period (as stipulated by the lender). The top-up loan can be utilised for any of your personal needs, just like a Personal Loan.
How to Calculate Car Loan EMI?
Manual EMI calculation is time-consuming and prone to errors. You can use the online EMI Calculator, available on MyMoneyMantra's website for free to calculate the EMI of your car loan.
All you need to do is follow these steps:
- Visit MyMoneyMantra' website
- Go to the EMI Calculator page mentioned under Financial Tools tab
- Fill in the details required, viz. Loan amount, tenure of repayment, and interest rate
- Click on the Calculate button to know the result instantly
Foreclosing a Car Loan
Some banks like HDFC Bank offer car loans at zero foreclosure charges, while others may charge up to 5% on principal outstanding.
The common documents required by most banks for applying for a car loan are mentioned below:
- Identity proof - Any of the below mentioned documents:
- Aadhar Card
- PAN Card
- Voter's ID Card
- Driving License
- Address proof - any of the below mentioned documents:
- Aadhar Card
- Ration Card
- Driving License
- Passport Copy
- Voter's ID Card
- Electricity Bill
- Telephone Bill
- Life Insurance Policy
- Shop & Establishment Act Certificate, SSI Registered Certificate, Sales Tax Certificate (for partnership firms, private limited companies, and public limited companies).
- Income proof for salaried individuals: Latest salary slips, Form 16, and bank statement of the last 6 months
- Income proof for self-employed individuals (sole proprietorship): Latest ITR and bank statement of the last 6 months
- Income proof for self-employed individuals (partnership firms and private limited companies): Audited balance sheet, profit & loss account for the last 2 years, company ITR for the last 2 years, bank statement of the last 6 months.
- Income proof for self-employed individuals (public limited companies): Audited balance sheet, profit & loss account for the last 2 years, bank statement of the last 6 months.
Best Car Loan Providers with Interest Rates
The Indian middle class comprises 45% of the nation's population, amounting to approximately 54 crore people. Given that an entry-level car in the country currently costs upwards of 4 lakhs, most of the middle class and even people belonging to the upper economic strata depend upon Car Loans for purchasing new as well as pre-owned cars. Besides, EMI on Car Loan is affordable and
Let us take a quick look at the 12 best Car Loan interest rates in India in 2019:
HDFC Bank Car Loan
HDFC Bank is one of the leading Car Loan providers in the country, which offers up to 100% of the ex-showroom price of the car as the loan amount. The bank offers a fixed-rate loan starting at 8.9 %per annum, with maximum repayment period of 7 years. Consequently, lowest EMI for a month would be as low as 1,604 per Lakh, per 1 Lakh.
The bank allows foreclosure of the loan, albeit only after 6 months from the date of availing the loan. Foreclosure of the loan attracts an additional cost of 6% of principal outstanding for foreclosure within 1.5 years from the date of availing the loan; 5% of principal outstanding for foreclosure within 13-24 months, and 3% of principal outstanding for foreclosure after 24 months.
The bank also allows part payment of the loan, although only twice during the tenure. Moreover, the part payment should not be beyond 25% of the principal outstanding amount.
Eligibility for HDFC Bank Car loan
- The applicant can be a salaried individual, self-employed individual or a working professional, belonging to a sole-proprietorship, a partnership, a public, or a private limited company.
- The age of the applicant must be at least 21 years at the time of applying for the loan. Besides, the applicant should be no older than 60 years by the time of the repayment of the loan.
- The bank mandates the individual to have a minimum work experience of 2 years, with a minimum of 1 year at the current organisation.
- The minimum income requirement for applying for an HDFC Car Loan is 3 lakh per annum.
SBI Car loan
Talking abou the best Car Loan Interest Rates, SBI has earned quite a reputation with a floating rate as low as 8.90%, which turns out to be EMI of 1,604 Per Lakh for 7 years. The bank offers a Car Loan for up to 90% of the on-road price of the vehicle.
SBI Car Loans are offered for up to 7 years, wherein the interest is calculated on daily reducing balance. The bank does not levy any advance EMI and even offers an option of SBI Insurance Life Cover along with the loan.
Eligibility for SBI Car Loan
- A salaried individual working for State/Central Government, Public Sector Undertaking, Private Company or a Reputed Establishment, can be eligible for an SBI Car Loan if they enjoy a net income of at least 2.50 Lakh per annum. In this case, the maximum loan amount offered by the bank is 48 times the net monthly income of the applicant.
- Any professional, self-employed individual or business owner of any proprietary/partnership firms who files an ITR is eligible for an SBI Car Loan, subject to a net income of at least 3 Lakh per annum. In this case, the maximum loan amount offered by the bank is 4 times gross taxable income.
- Any person engaged in agricultural and allied activities can apply for an SBI Auto Loan, provided they enjoy a net annual income of at least 4 Lakh. In this case, the maximum loan amount offered by the bank is 3 times the net annual income of the applicant.
ICICI Bank Car Loan
One of the most expected names on this list is that of ICICI Bank. The bank offers a loan of up to 100% of the on-road price of the car. Here, you must understand that the on-road price of the car is the actual payable price of the car to the dealer, which includes State Registration Charges, Road Tax, Insurance Cover and many other additional charges paid for extra accessories.
The ICICI Bank offers fixed Car Loan interest rates starting from 9.30% per annum for a tenure of up to 7 years. The minimum EMI by the bank is rather low at 1,625 per Lakh for 7 years.
Axis Bank Car Loans
Axis Bank offers fixed interest Car Loans on a modest rate starting at 9.05% per annum. What makes Axis Bank Car Loans highly popular amongst new car buyers is the longest repayment period of up to 8 years, which brings down the EMI to as low as 1,611 per Lakh for 8 years.
The minimum loan amount offered by the bank is 1 lakh per annum, while the maximum loan amount can go up to 100% of the on-road price of the desired car.
The bank also offers certain additional benefits for its priority banking customers.
Axis Bank Car Loan Eligibility
- In order to avail Car Loan, the applicant must be at least 21 years of age at the time of applying loan, and not more than 70 years of age at the time of maturity of the loan.
- A salaried individual can avail an Axis Bank Car Loan if they enjoy a minimum net annual income of 2.4 Lakh, and have at least 1 year of continuous employment.
- A self-employed individual can enjoy a Car Loan from Axis Bank if they have a minimum net annual business income of 1.8 Lakh for selected car models and 2 lakh for others. In this case, a minimum of 3 years of employment in the same line of business is required.
- The Car Loan can also be availed by self-employed non-individuals with a minimum Net Annual Business income or 1.8 Lakh for selected models and 2 Lakh for others. The income eligibility in this context is based on the latest 2 years Income Tax Returns and warrants a minimum of 3 years of employment in the same line of business.
IndusInd Bank Car Loan
When compared to other banks on this list, IndusInd Bank Car Loan might seem a bit on the expensive side, considering it is made available at an interest rate of 10.65%. Nonetheless, the loan is ideal for a vast majority of people on the lookout for a short term of up to 5 years. The EMI will be minimum of 2,157 per Lakh.
The bank offers a maximum loan amount of up to 85% of the ex-showroom price of the car.
Eligibility for IndusInd Bank Car Loans
- An applicant must be between 21 to 60 years of age at the time of applying for the loan.
- Both salaried individuals, as well as self-employed professionals and business owners, can opt for this loan, provided they enjoy a minimum annual income of 2.5 Lakh.
- The bank also requires the applicants to have a work experience of at least 3 years, with a minimum of 1 year at the current organization.
- In order to be eligible for the loan, the bank mandates it for the applicant to have lived in the city for at least 3 years, with a minimum of 1 year at the current residence.
- The applicant should have a minimum CIBIL score of 600, and should not belong to a negative or caution profile.
Kotak Bank Car Loan
When it comes to taking a loan for the purchase of a new car, many customers opt for the Kotak Bank Car loan, largely because of the minimum income requirement. The applicant with a minimum salary of 15,000 per month can apply for Kotak Car Loan. The loan is slightly on the expensive side, considering the interest rate of 11.50% per annum, which brings the actual interest to 2,199 per lakh, per EMI for 5 years. The maximum loan amount handed in this case is up to 90% of the ex-showroom price of the car.
Eligibility for Kotak Bank Car loan
- The bank offers the loan to all Indian residents, who are above the age of 21 and enjoy a minimum monthly income of 15,000.
- The applicant must have a redience as well as the employment for a minimum of 1 year in the city where the loan is applied.
PNB Car Loan
Punjab National Bank offers a Car Loan for a maximum of 7 years, at a minimum rate of interest at 8.90% per annum. So, the minimum EMI will be 1,604 per lakh for 7 years. The maximum loan amount offered by the bank is up to 85% of the on-road price of the car.
Eligibility for PNB Car Loan
- The applicant, either an individual(s) or a business concern (corporate or non-corporate), can avail the loan for purchasing a car to be used for private purposes only.
- In order to be eligible for PNB Car Loan, the applicant must have a minimum monthly income of 20,000.
- The maximum loan amount, in case of individuals, will be confined to 1 Crore, or 25 times the net monthly income of the applicant, whichever is lower.
- For business concerns, there is no upper limit on the loan amount.
Union Bank of India Car loan
Any resident or non-resident Indian can avail a Car Loan offered by Union Bank of India, provided they have a valid licence. The bank offers a floating interest loan, at the rate of 8.85 % per annum. The maximum repayment period allowed by the bank is 7 years, and thus mimum EMI for 7 years will be 1,601 per Lakh. The maximum loan amount offered by the bank is up to 85% of the on-road price of the car.
Eligibility for Union Bank of India Car loan
- The applicant must be between 18 to 70 years of age.
- One can apply as an individual, or as co-applicant with the other members of the immediate family.
- A company or firm can also apply for a Car Loan if the vehicle is intended to be used by their directors or employees.
- The maximum Car Loan amount offered by the Union Bank of India is 1.25 Lakh.
Central Bank of India Car Loan
The Central Bank of India offers floating-interest Car Loan at the rate of 9% per annum, for a maximum repayment tenure of 7 years, bringing EMI to 1,609 per Lakh. The bank offers a loan up to 90% of the on-road price of the car.
Eligibility for Central Bank of India Car Loan
- The loan is offered only to applicants who are between 18 and 65 years of age.
- The loan can be availed by salaried individuals, self-employed people, as well as independent entrepreneurs who enjoy a regular stream of income.
- The loan can also be availed by farmers irrespective of land holding, non-resident Indians as well as companies, proprietorships, partnership firms, co-op societies etc.
- The applicant must have a minimum annual income of 2.4 Lakh.
- The maximum loan amount offered by the bank is 75 lakh.
Andhra Bank Car Loan
Andhra Bank offers fixed interest Car Loan on a modest rate of 9.40% per annum, for a fairly long tenure of up to 7 years. The minimum EMI will be as low as 1,629 per Lakh for 7 years. The bank usually sanctions the loan for up to 85% of the on-road price of the car.
Eligibility for Andhra Bank Car Loan
- The bank readily offers Car Loan to any applicant with a minimum gross income of 1 Lakh per annum, as well as to all the corporate customers of the Bank.
- The loan amount for which the applicant is eligible is usually calculated on the basis of the repayment capacity of the applicant. In general, the bank ensures that the Car Loan EMI does not exceed 60% of the net monthly income of the applicant in case of salaried individuals and 70% in case of non-salaried class.
Federal Bank Car Loan
Federal Bank Car Loan offers a fixed rate loan at 9.50% per annum for up to 7 years, i.e. a minimum EMI of 1,634 per Lakh. The bank readily offers a loan amount of up to 100% of the ex-showroom price of the car.
The bank also offers free personal accident insurance of up to 10 Lakh for individual applicants.
IDBI Bank Car Loan
The bank offers a fixed interest Car Loan, at the rate of 9.37% APR. Given that the maximum repayment period allowed by the bank is 7 years, the minimum EMI is 1,628 Per Lakh. The maximum loan amount offered by the bank is up to 90% of the ex-showroom price of the car.
Eligibility of IDBI Bank Car Loan
- In order to avail the Car Loan by IDBI Bank, the applicant must be between 18 and 70 years of age.
- The applicant should enjoy a minimum net income of 2.4 Lakh per annum.
These are the top Car Loan providers in India. You must choose the one that best matches with your needs and preferences.
FAQs - Car Loan
Which is the best bank for a car loan?
As of now, ICICI Bank Car Loan ranks the best as it comes with an attractive interest rate of 8.80% to 15%, depending on the segment of the vehicle. Low interest rate means affordable EMIs.
Can I get the entire cost of my car as a loan amount?
Usually, lenders offer 80-90% of the financing. However, some banks offer up to 100% financing, also known as Zero Down Payment Car Loan. The amount can either be of 'On-Road Vehicle' price or the 'Ex-showroom' price. ICICI Bank, HDFC Bank, and Axis Bank are some of the best banks that offer car loans up to 100% of the on-road price of the car.
Do I need to make any down payment to buy a car?
Yes. Most banks require you to pay a minimum of 20% as a down payment for new cars and 10% for used cars.
What is the eligibility required for a car loan?
Every bank has its own set of eligibility criteria. Here are some common eligibility factors sought by the bank for a car loan:
- Age: Minimum 21 years when applying for the loan and maximum 70 years loan at maturity
- Minimum Net Annual Income: 2,40,000 p.a. for salaried individuals and 2,00,000 p.a. for others, based on the latest salary slip, ITR, and Form 16.
- Minimum employment/ business experience: 1 year of continuous employment for salaried individuals, minimum 3 years in the same line of business for self-employed professionals/business owners.
How much minimum income should I have to avail a car loan?
The annual income requirement may vary from bank to bank. However, most banks require 2,40,000 p.a. for salaried individuals and 2,00,000 p.a. for others, based on the latest salary slip, ITR, and Form 16 (as applicable).
What is the minimum credit score required for a car loan?
A credit score of 750 and above is considered excellent for a car loan.
Does my credit score affect the car loan interest rate?
Yes. Your credit score reflects your past repayment behaviour and your creditworthiness for a loan. Hence, your credit score has a huge impact on your car loan interest rate. Having a reliable credit score (preferably 750 or above) will be great to get instant loan approval and low interest rate.
Is it mandatory to have a guarantor for a new car loan?
Generally, a guarantor is not required for a car loan. However, if you don't fulfil the eligibility criteria of the car loan provider, you may need a guarantor. For example, if your income is lower than what is required by the bank, they may ask you to furnish a guarantor with eligible income level.
What is the repayment tenure available for a car loan?
Most of the car loan providers in India offer a repayment tenure of between 1 to 7 years.
What documents are required for car loan?
- Identity proof : Aadhar Card / PAN Card/ Passport/ Voter's ID Card/ Driving License ( Any one)
- Address proof : Ration Card, Driving License, Passport Copy, Voter's ID Card, Electricity Bill, Telephone Bill, Life Insurance Policy (Any One)
- Income proof for salaried: Latest salary slips, Form 16, and bank statement of the last 6 months
- Income proof for self-employed individuals: Latest ITR and bank statement of the last 6 months
How much time does it take for processing a car loan?
If all documents are correct and are submitted timely with duly filled in loan application, the loan can get approved in a couple of days.
Car Loan Latest News
28.11.2019: Axis Bank offering FASTags for free before December 1 Deadline
FASTags have become mandatory for private as well as commercial vehicles that will cross toll plazas on all national highways in India. There is a huge rush to buy FASTags for vehicles. Sensing the demand, Axis Bank has made these tags free for vehicle owners for the initial few months.
27.11.2019: ICICI Bank launches new car loan scheme called Smart EMI facility
ICICI Bank, a private sector lender, has launched a new car loan facility called 'Smart EMI', in association with TranzLease, an automobile leasing & mobility solutions company. Smart EMI, is a next generation auto loan that enables customers to get a new car home at lower cost. The facility will take care of the insurance as well as maintenance requirement of the vehicle bought, during the financing period.
11.09.2019: HDFC Bank announces to offer pre-approved car loans
HDFC Bank has announced to offer pre-approved vehicle loans to car buyers on the websites of car makers. The bank is creating APIs (application programming interfaces) that will help it strengthen its presence in the line of business that it already leads. The bank's new API will help in connectin prospective car buyers to companies/ car aggregators by offering them pre-approved loans on the basis of their credit history, and transactions with the lender.
22.04.2019: SBI launches Green Car Loan
State Bank of India (SBI) announced on Monday to launch the country's first 'Green Car Loan' (for Electric Vehicle). The facility will encourage customers to buy more electric vehicles. Under the scheme, customers will get a discount of 20 basis points on a car loan. SBI Green Car Loan scheme comes with the longest repayment tenure of up to 8 years and zero processing fee for the first 6 months of the launch.