Interest rates across retail loan categories, including car loans, have been low for close to two years. This is thanks to the benign interest rate scenario prevailing in India since March 2020, when COVID-19 stormed into the country. While some banks such as SBI and HDFC Bank have recently raised their fixed deposit rates for certain tenures, the trajectory of interest rates in the system will be clear only after the Reserve Bank of India's monetary policy review in February.
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At 6.65 percent, this public sector major offers the lowest interest rate on car loan of Rs 10 lakh with tenure of seven years. The equated monthly installment will amount to Rs 14,922.
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State-owned lenders Bank of Maharashtra and Punjab and Sind Bank are next on the list, charging an interest rate of 6.8 percent. The EMI at this rate will work out to Rs 14,995.
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Another government-owned lender, this bank offers an interest rate of 6.85 percent for Rs 10 lakh car loans with seven-year tenures.
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With an interest rate of 6.9 percent, Indian Bank makes its way into the list. If you were to take a Rs 10 lakh car loan with tenure of seven years from this banks now, you will pay an EMI of Rs 15,044.
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The list of cheapest car loans is dominated by loan offers from public sector banks. Bank of Baroda charges an interest rate of 7 percent per annum for car loans of Rs 10 lakh with a tenure of seven years.
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The data is provided by Bankbazaar.com. Interest rates on car loans for all listed (BSE) public and private sector banks (excluding small finance banks) have been considered for data compilation. Banks for which data is not available on their websites have not been considered. Data has been collected from respective banks' website as on January 6, 2022. Banks are listed in the ascending order, on the basis of interest rates - that is, bank offering the lowest interest rate on car loan is placed at the top and highest at the bottom. Lowest interest rates offered by the banks, irrespective of loan amount, has been taken into account. EMI is calculated on the basis of interest rates of listed banks, for Rs 10-lakh loan with tenure of seven years (processing and other charges are assumed to be zero for EMI calculation). Interest rates mentioned are indicative and may vary depending on banks' terms and conditions.
