Punjab & Sind Bank, Central Bank of India offer the cheapest car loans
Canara Bank, Punjab National Bank charge 7.3 percent for Rs 10-lakh car loans
March 01, 2021 / 02:16 PM IST
With car loan interest rates starting at as low as 7.1 percent, it is a good time to buy a car if you have been planning to buy one, given the prevailing lower interest rates in the system.
The top ten cheapest car loans on offer currently are from public sector banks. Like home loans and other retail loan categories, this space has benefited from benign interest rate regime. For a Rs 10-lakh car loan with a tenure of seven years, the equated monthly installments (EMI) hover around Rs 15,000. State-owned Punjab & Sind Bank (7.1 percent) has been offering the lowest interest rates for several months now, followed by Central Bank of India (7.25 percent), as per data from Bankbazaar.com.
About the table
Interest rates on car loans for all listed (BSE) public and private sector banks were considered for data compilation. Banks for which data is not available on their websites have not been considered. Banks are listed in ascending order on the basis of interest rate i.e. bank offering lowest interest rate on car loan is placed at top and highest at the bottom. Lowest interest rate offered by the banks on loan of Rs 10 lakh is shown in the table. EMI is calculated on the basis of interest rate mentioned in the table for Rs 10 lakh loan with tenure of seven years (processing and other charges are assumed to be zero for EMI calculation). Interest mentioned in the table is indicative and it may vary depending on banks’ terms and conditions.
Car loans do fall in the ‘good’ loans category as they result in creation of an asset. However, it is a depreciating asset. So ensure that you are going ahead with your purchase only if there is a genuine need, which could indeed be the case for many who wish to avoid public transport in COVID-19 times.