Two Wheeler Loan Interest Rates

Bike Loan Interest Rate

The interest rate plays a very important role in debts. A lower interest rate yields low EMI. Hence, interest rate is the major consideration when applying for any type of loan. At SMFG India Credit, we offer a competitive two-wheeler interest rate best suited to your profile.

Two-wheeler loan interest rate varies between 19% and 28%* per annum and depends on several factors as mentioned below:

1. Profile of the Customer: Customers with a good CIBIL Score, a regular monthly income, and a low fixed obligation to income ratio can avail of the loan at lower interest rates. Remember that the interest rate depends on the perceived risk the lender is taking on. If you have a good credit history and have a high surplus income, you would be able to repay the loan easily and hence may be considered a lower risk.
2. Tenure of the Loan: Typically, the total interest amount paid increases as the loan tenure increases. However, a shorter tenure would mean a higher EMI and could strain your finances. Therefore, determine the tenure of the loan based on the EMI you would be able to pay without stretching your finances too thin. You can use our two-wheeler EMI calculator to arrive at an informed decision.
3. City of Residence: Lenders may provide preferential rates of interest to applicants from metro cities, depending on their internal policies.
4. Type of Vehicle Purchased: Whether it is a moped, a Scooter or a high-end bike, SMFG India Credit’s Two Wheeler loan is available for all types of vehicles (except electric vehicles). However, the two wheeler loan interest rate varies for each of the vehicle types.
5. Prior Relationship with SMFG India Credit: Existing customers with excellent repayment histories and who fit SMFG India Credit’s eligibility criteria may be offered preferential two wheeler interest rates depending on our policy at the time of loan application. Thus, if you are an existing customer, and would like to avail a two wheeler loan, you are welcome to visit us at your nearest branch or call us to know more. 

Types of Two Wheeler Loan Interest Rates

Interest rates are of two types – fixed and floating. 

At SMFG India Credit, we offer fixed rates of interest on two wheeler loans. With a fixed rate of interest on the two wheeler loan, the monthly installment amount remains the same right till the end of the repayment period. Generally, the fixed rate of interest is low on the risk front and ranges from 19% to 28% per annum. You can avail the benefits of a lower interest loan providing you meet the lender’s policy.

Two wheeler loans from SMFG India Credit require minimal documentation, and are provided at reasonable interest rates.

Why Is Fixed Bike Loan Interest Rate Better?

The fixed rate of interest ensures that there is no change in the interest rate during the tenure of your loan repayment. The variable rate of interest can fluctuate depending on current market conditions, roping in the factor of uncertainty.

With a fixed rate of interest, you do not have to worry about any change in your monthly installments. That’s why a fixed interest rate loan is preferred because it ensures financial security despite volatile market rate dips and saves you the trouble of bearing heavy expenses.

Fixed rates of interest on bike loans range from 19% to 28%, depending on numerous factors like a good CIBIL score (700-900), longer tenure of the loan, area of residence, type of vehicle purchased, prior history with the lending company, and the lender’s policy.

Hence, it is highly recommended to choose a fixed rate of interest for a bike loan since it brings along pocket-friendly benefits.

Documents Required for Bike/Two-Wheeler Loan

• Government employees: Copy of previous three months' salary slips.
• Private company employees: Salary slips/certificates indicating deductions, along with a copy of Form 16.
• Self-employed individuals: Copy of Income Tax returns.
• KYC documents: Proof of identity (Aadhaar Card, Drivers' license, PAN Card, etc.), proof of address (Electricity bill, Bank passbook, Aadhaar Card, Drivers' license, etc.), passport-size photographs.
• Duly filled application form.

Please note that depending on the lender’s policy, additional documents may be requested.

Who Can Apply for the Two-Wheeler Loan?

• Age: Minimum age of 18 years at the time of loan application and maximum age of 60 years before the loan matures.
• Residency: Must be a resident of India and have resided at the same address for a minimum period of 1 year.
• Employment: Must be an employee at a private limited company, an MNC, or a public sector enterprise for a minimum of 1 year. For self-employed professionals, IT Returns for 1 consecutive year need to be provided.
• CIBIL score: Must have a good CIBIL score of at least 700 or above.
• KYC documents: Must have all the relevant KYC documents.

Benefits of Two-Wheeler Loan

Two-wheeler loans are popular because they can be availed by anyone, anywhere. Also, Two-wheeler loans offer several benefits as mentioned below.

• Minimal and straight-forward documentation
• Available to individuals from all walks of life and financial background
• Flexible repayment tenure to suit your requirements
• Reasonable interest-rate making it affordable for all
• Low processing fee