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South Indian Bank is a one of the major private sector banks in the country and has its headquarters in Thrissur, Kerala. Car loans are among the many products offered by the bank. These loans can be applied for purchasing a new car or a used or send hand car or even in case of reimbursement of a car already purchased provided it is not older than 3 months from the date of purchase. The details of the car loans of the Bank are discussed below.
About South Indian Bank Car Loan Interest Rates
The Bank provides car loans at very competitive interest rates and has wide eligibility criteria that can benefit the majority of customers.
The key features of the car loans of the Bank are tabled below.
Maximum Amount of Loan
For new cars
For Used cars
Rate of Interest
For New Cars
For Used Cars
Hypothecation of the vehicle to be purchased out of loan
No additional guarantee or collateral security required
1% of the Loan amount
These highlights mentioned above are discussed in depth hereunder.
Quantum of Loan
South Indian Bank provides car finance to the tune of up to 90% of the value of the vehicle in case of new cars and 75% of the value of the vehicle in case of used cars. The minimum loan amount sanctioned is Rs. 1,00,000 . The maximum amount of loan that can be provided by the bank for new cars or used cars is tabled below.
Type of vehicle
Such amount is irrespective of class of borrowers.
South Indian Bank Car Loans are based on the floating rates of interest as well as fixed rate of interest. The floating rates are based on the REPO Rates and differ in case of loans for purchase of new cars or second hand cars. The current applicable rates levied by the Bank for its Car loans are tabled below.
Rate of Interest (Floating rates)
8.80% - 9.25%
13.30% - 13.75%
The bank also provides car loans at fixed rates of interest. The details of the same can be available by contacting the bank through its nearest branch or through the customer care service of the bank.
The repayment period of car loan of the bank depends on the type of vehicle to be purchased out of loan sanctioned. The maximum period of repayment in case of new cars is 7 years (84 monthly EMIs) whereas in case of used cars it is 5 years (60 monthly EMIs).
The minimum tenure for repayment of car loans of South Indian Bank is 1 year (12 monthly EMIs).
Margin money is a mandatory requirement of South Indian Bank Car Loan to be provided by the borrower as part of the loan application process. The bank has specified the quantum of margin money to be provided in case of purchase of new cars as well as used cars. The minimum margin money required by the Bank for its car loans is tabled below.
Type of Loan
10% - 20% of the on road price of the car
25% of the on road price of the car
The primary security of the loan provided by the bank is the vehicle purchased out of loan. Bank has the hypothecation charge on such vehicles.
South Indian Bank does not require any additional security or guarantee for its loans apart from the primary security mentioned above.
South Indian Bank levies 1% of the loan amount as processing fees. These charges are levied at the time of sanction of loan. The maximum amount that is charged as processing fees for the car loans is Rs. 10,000.
Part payment or Foreclosure Charges
South Indian Bank does not levy any prepayment charges in case of loan sanctioned at floating rates for individual borrowers. In case of loans based on fixed rates of interest and sanctioned to non-individual borrowers, the applicable charges on prepayment of loan are tabled below,
Up to 12 months
2% of amount prepaid
Above 12 months
1% (applicable on foreclosure of loan)
There are many factors that influence the rate of interest for car loans of South Indian Bank. These factors affect the rate of interest on an intrinsic level and make it a very crucial point of consideration while selecting a loan product of the lender.
These factors are mentioned below.
Loan amount as required by the borrower is a key factor influencing the rate of interest. A borrower that has a higher loan requirement will get the loan at higher rate of interest and vice versa.
The type of vehicle is another factor that will influence the rate of interest. The rate of interest for a new car is higher than the rate of interest on used cars.
Inflation is an external factor that directly influences the rate of interest in any country. Floating interest rates are directly proportional to inflation and follow its trend. Fixed interest rate loans may not change directly based on inflation but does become cheaper or costlier depending on the inflation.
Type of interest rate (whether Floating rate or Fixed rate)
Floating rates are generally cheaper as compared to fixed rates of interest which factor in many costs incurred by the bank for lending the funds.
Repaying capacity of the applicant
The repaying capacity of the applicant is the credit worthiness of the applicant and is the basis for sanctioning the loan. Lender will review the repaying capacity of the applicant thoroughly before sanctioning the loan so as to correctly factor in the risk involved in lending the funds.
The repayment period or tenure of the loan is the time period agreed by the borrower to repay the loan taken. If the loan amount is lower and tenure is also short, the risk is considered to be lower and hence the interest rate is also lower. Another point of consideration is that a higher loan amount with lower tenure can be termed high risk attracting higher interest.
Credit Score of the applicant
The credit score of the applicant is the basis of determining the rate of interest. A person with a higher credit score will get the benefit of reduced rate of interest as compared to an applicant with lower credit score.
Margin money is part of the value of a vehicle that has to be provided by the borrower. It reduces the risk of the lender and thereby the rate of interest.
The car loans of the bank are available for the purchase of new cars or second hand cars. These loans are in the nature of retail loans and are targeted for a specific set of customers. These customers are specified below.
All the residents of the country
Persons engaged in the agriculture
Any person drawing pension
The age requirement for the eligible individuals stated above is tabled hereunder,
Category of Persons
The bank will review the eligibility of all the applicants in case of co-borrowers.
The documents needed for the car loan of South Indian Bank are based on the category of applicants. These documents are a set of basic KYC documents along with documents relating to income proof and the vehicle to be purchased out of the loan.
The details of such documents are mentioned below.
Bank Statement for the past 12 months
Passport Size photograph
The bank provides the customers with the option of online application or offline application for its car loan. The offline application process is where the customer has to physically visit the branch of the bank and apply for the loan there. Customers can get the application form directly from the bank or can download the same from the website of the bank, duly fill it and submit it along with the necessary documents.
The online application process involves submitting an application request through the website of the bank. The representatives of the bank will contact the customer for further application process. The link for the same is mentioned below.
Home >> Apply for Product /Service
Home >> Personal Banking>> Loans>> Car Loans>> Apply
Customers can also apply for the loan through the mobile application of the bank.
1. What is the minimum loan amount for a car loan from South Indian bank?
The minimum amount of loan for Car Loan of South Indian bank is Rs. 1,00,000.
2. What is the minimum age to be eligible for a car loan from South Indian bank?
The minimum age to be qualified for Car Loan of South Indian bank is 18 years.
3. Can a person apply for the loan through mobile banking?
Yes. The mobile banking application of the Bank can be used to request a call back regarding car loan application.
4. What is the margin money for used cars under this loan scheme?
The margin money to be paid for used cars is 25% of the on road value of the vehicle.
5. What are the processing charges levied on car loans of the Bank?
SIB charges 1% of the loan amount as processing charges subject to a maximum of Rs. 10,000.
6. Are prepayment or foreclosure charges levied on borrowers with floating interest rate loans?
No. Prepayment or foreclosure charges are levied only on non-individual borrowers having fixed rate loan options.
7. What is the minimum tenure for car loan of SIB?
The minimum tenure for car loan of SIB is 12 months.
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