The push for electric vehicles in the country is starting to be felt. To make electric cars popular, more and more incentives should be launched in the coming times. The country’s largest lender, State Bank of India (SBI), on the occasion of World Earth Day, launched India’s first ‘green car loan’ (electric vehicle) to encourage customers to buy electric vehicles.
To achieve this goal, SBI will offer loans at 20 basis points below the interest rate of existing auto loan programs. The SBI Green Car Loan (Electric Vehicle) program will have a longer repayment period of up to 8 years, compared to 7 years in its regular car loan program. In addition, the bank waives processing fees for the first six months of launch.
Already SBI offers the lowest interest rates and therefore has the lowest EMI and comes with the longest repayment term of 7 years on regular auto loans. SBI auto loans come with 90% financing on the “road price” which includes registration, insurance and extended warranty, service package, annual maintenance contract and cost. accessories. Additionally, interest on SBI auto loans is calculated on the daily reducing balance and has no prepayment penalty or foreclosure fee.
The maximum loan amount for a regular employee of the state or central government, public sector enterprise, private enterprise or reputable establishment is 48 times net monthly income.
For professionals, the self-employed, businessmen, company owners or in partnership which are liable to income tax, the maximum loan amount is capped at 4 times net profit or gross taxable income depending on the ‘ITR after adding amortization and repayment of all existing loans.
Currently, the fixed interest rate on auto loans (1-year MCLR: 8.50%) varies between 9.25 and 9.75%. According to the SBI website, the average auto loan rate 9.52%.
The actual interest rate will be based on the credit rating obtained by SBI from one of the CICs. CIC stands for Credit Information Companies. For a loan amount of Rs. 5 lakh and above, the lower CIC score will be taken into account by one of the two CICs to obtain the interest rate.
The interest rates on new car loans based on CIC scores are as follows: (Effective 10.04.2018)
Company salary package: 0.75% per year above the 1-year MCLR, i.e. 9.25% per year
Other than the corporate salary package:
- CIC score of 750 and above: 0.75% per year beyond one MCLR year, i.e. 9.25% per year
- CIC score of 700 and up to 749: 0.95% per year above a one-year MCLR, i.e. 9.45% per year
- CIC score less than 700: For men: 1.25% per year over 1 year MCLR i.e. 9.75% per year and For women: 1.20% per year over 1 year MCLR i.e. 9 , 70% per year
On Green Car Loan, the interest rate will be 20 basis points lower than the interest rate of existing car loan programs.