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 16% and 30%* per annum and depends on several factors as mentioned below:

• 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 service the loan better and hence considered a lower risk.
• Tenure of the Loan: Typically, the interest rate goes down as the tenure of the loan increases. That said, the total interest would still increase with the tenure of the loan. Therefore, determine the tenure of the loan based on the EMI you would be able to pay without stretching your finances too thin.
• City of Residence: You would enjoy a lower interest rate if you live in a metro city compared to a non-metro area. This is primarily because vehicles in the non-metros carry a higher risk of loss – both from accidents and theft.
• 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. However, the two wheeler loan interest rate varies for each of the vehicle types.
• Prior Relationship with SMFG India Credit: We would like to nurture our on-going relationship with our valued customers, and promise to provide better interest rates to those who have been with us for long. Thus, if you are an existing customer, and would like to avail a loan, you are welcome to visit us at your nearest branch or call us to know more about two wheeler loan interest rates and other details.

Types of 2 Wheeler Loan Interest Rates

Actually, two wheeler loans are available on both variable and fixed rates of interest. But fixed interest rate is the most favorable type of interest rates applicable on two wheeler loans.

With a fixed rate of interest on the two wheeler loan, the monthly instalment 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 16% to 30% per annum as per your credit profile. You can avail the benefits of a lower interest loan with a good CIBIL score and longer loan tenure. Additional factors can be whether or not you reside in a metro city and the type of two-wheeler you select.

The best part about loans with fixed rates of interest is that they come with minimal documentation, apply to all financial backgrounds and have low processing fees.

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 16% to 30%, depending on numerous factors like a good CIBIL score (700-900), longer tenure of the loan, area of residence, type of vehicle purchased, and prior history with the lending company.

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