Owning a bike or scooter is the dream of millions of Indians. Whether you’re looking for a reliable mode of transport for your daily commutes or to go on long drives with your friends, a two-wheeler is the best and most preferred option. It's easier and cheaper to maintain when compared to cars. The best part is that two-wheelers are available in a wide range of models – geared and gearless – suiting all budgets. Not just men, working women, college-going students, and homemakers prefer scooters for their commutes.
If you don't have sufficient funds to pay the entire cost of the two-wheeler in one-go, you can opt for a bike loan to purchase your dream vehicle. Several banks and NBFCs offer two-wheeler loans at low-interest rates. Borrowers can quickly repay the loan with monthly EMIs.
Before you apply for a two-wheeler loan, you need to compare the rates of interest, available tenure, processing fees, foreclosure charges, and other details. CreditMantri can help you make the right decision. Here, in this guide, we list out the latest interest rates of two-wheeler loans, so that you can choose the best deal that works for you.
Interest Rates offered by Top Two Wheeler Loan Lenders for 2020
Here is a list of the interest rates offered by leading banks and NBFCs for bike loans. However, note that the actual interest rate provided to you may be slightly higher or lower, depending on your creditworthiness and other factors.
|Name of the Lender||Two Wheeler Loan Interest Rate||Maximum Loan Amount||Tenure||Processing Fees|
|Bajaj Auto Finance||Starts from 7.85%||Determined by the lender on a case by case basis||Up to 3 years||1% to 3.5% of the loan amount|
|Bank of India||7.75% to 8.35%||Determined by the bank on a case by case basis (Maximum Rs. 50 lakhs for individuals)||Up to 5 years||1% of the loan amount (Minimum Rs. 500 and Maximum Rs. 10,000)|
|Bank of Maharashtra||9.5% onwards||Up to 85% of the bike’s on-road price (Maximum Rs. 1.25 lakhs)||Up to 5 years||0.25% of the loan amount (Minimum Rs. 500)|
|HDFC Bank||11.83% to 26.83%||Up to 85% of the bike’s on-road price||Up to 3 years||3% of the loan amount|
|ICICI Bank||10.5% onwards||Up to 100% of the bike’s on-road price||Up to 4 years||1% to 2.5% of the loan amount (Maximum of Rs. 2500 to Rs. 5000)
Special processing fees of Rs. 1500 for existing ICICI bank customers
|Punjab National Bank||9.8% onwards||90% of the bike’s ex-showroom price (maximum of Rs. 1.5 lakhs for regular bikes, maximum of Rs. 10 lakhs for super bikes)||Scooters and mopeds – 60 EMIs
Scooterettes – 30 EMIs
Mopeds – 24 EMIs
|0.35% of the loan amount (minimum – Rs. 2500; maximum – Rs. 15,000)|
|State Bank of India||7.75% onwards (for applying using YONO app)
8.00% onwards for others
|85% of the ex-showroom price of the bike
(minimum – Rs. 30,000; maximum – Rs. 2.5 lakhs)
|Up to 3 years||1.5% to 2% of the loan amount + GST|
|Tata Capital||Starts at 10.75%||Up to 95% of the on-road price of the vehicle (minimum – Rs. 25,000; Maximum Rs. 3 lakhs)||Up to 5 years||3.10% of the loan amount|
Key Points to Know Before you apply for Two Wheeler Loans
Several leading banks and NBFCs (Non-banking Financial Corporations) offer two-wheeler loans.
Most lenders offer loans up to 90% to 100% of the cost of the vehicle.
Generally, two-wheeler loans do not require a guarantor. Your bike acts as the collateral.
Most lenders offer loans for the on-road price of the vehicle. This means the loan amount covers the cost of purchasing two-wheeler insurance, registration, and other accessories for the bike.
The eligibility criteria for two-wheeler loans are relaxed. It's available to all borrowers, without strict income limits.
Two-wheeler loans offer secure repayment options, generally in the form of monthly EMIs.
The application process is quick and hassle-free and requires minimal documentation.
Once you have submitted the required documents, the loan is approved quickly.
Most two-wheeler dealerships have partnerships with lenders. You can opt to choose the lender recommended by the dealer or go with your preferred lender.
How are the interest rates determined for two-wheeler loans?
Interest rates of two-wheeler loans vary from one lender to another. Additionally, the interest rate is determined by several factors like – borrower's income, credit score, employment, and the type of vehicle purchased.
As two-wheeler loans are secured loans, the interest rate is relatively lower. Here, the purchased bike/scooter acts as the collateral. Since it's a secured loan, it can be availed without the need to provide any collateral or guarantee.
The interest rate plays a crucial factor in determining the overall loan cost. Here are a few factors that impact the interest rate of the loan:
Type of the Two Wheeler – The lender generally charges higher interest rates for high-budget vehicles like race bikes, off-road bikes, etc. On the other hand, the interest rates are relatively lower for everyday use bikes, mopeds, and scooters.
Employment and Income Levels of the Applicant – The interest rate varies based on the income levels and the job of the borrower. Generally, salaried employees can avail loans at lower interest rates compared to self-employed individuals.
The credit score and history of the borrower – The credit history and credit score determine the creditworthiness of the borrower. Generally, lenders prefer borrowers with high credit scores. Higher your credit score, better are the chances of loan approval, and lower are the interest rates charged.
A pre-existing relationship with the lender – Lenders give preference for borrowers who are existing customers. For instance, if you have a fixed deposit or savings bank account with the lender, you can avail two-wheeler loans at lower interest rates compared to the interest rates charged to non-customers.
Eligibility Requirements for Two Wheeler Loans
Before your loan application is sanctioned, lenders check for various eligibility requirements. Though the actual eligibility criteria vary from one lender to another, here are the typical requirements for all lenders.
The borrower should be over 21 years (at the time of loan application) and less than 65 years (at the time of loan maturity).
Salaried, as well as self-employed individuals, are eligible for two-wheeler loans.
The borrower should have working experience of at least one year and reside in the city for one year or more.
Besides these standard eligibility requirements, all lenders consider the income and credit score of the applicant to determine whether he/she is eligible for the loan.
Compare Two Wheeler Loan Interest Rates
Before you sign the loan application with a lender, you need to compare the interest rates offered by different lenders. Interest rates comparison plays a crucial factor in helping you land the best deal. Now, you can easily compare the interest rates offered by different lenders online, using our handy guides.
Once you have decided on the lender, you can complete the process by applying for bike loans online. It's quick, easy, and hassle-free. Enter the required details, upload the necessary documents, and your two-wheeler loan application will be processed within a few minutes, right from the comfort of your home.