Car loan rates start at 7.60% in Nov: Top lenders offer and EMIs

Borrowers face a 7.60% to 14.25% rate spread, with public banks leading the low-cost options

Car buyers exploring financing will find that loan rates are broadly stable in November, with public sector banks (PSBs) offering the most competitive terms. According to data shared by Paisabazaar.com, several PSBs are quoting rates below 8 per cent at the lower end. Some lenders are extending processing fee waivers that can further reduce borrowing costs.

 

Public sector banks

The lowest car loan rates in mid-November are largely offered by PSBs.

 

Union Bank of India and Punjab National Bank are offering rates between 7.80 per cent and 9.70 per cent, translating to EMIs of Rs 10,090–Rs 10,550 on a Rs 5-lakh loan for five years. 

Canara Bank’s rates start at 7.70 per cent, with EMIs from Rs 10,067, and the bank is offering a full processing fee waiver till 31 December 2025.

 

UCO Bank is quoting 7.60 per cent to 10.25 per cent, with EMIs from Rs 10,043, and is charging no processing fee on car and electric-vehicle loans.

 

Central Bank of India has priced loans between 7.85 per cent and 9.45 per cent and is also offering nil processing fees until 31 March 2026.

 

Borrowers with an existing relationship may receive additional benefits. Bank of Maharashtra, for instance, provides a 0.25 per cent interest concession for home loan borrowers and long-standing customers.

 

Private banks relatively costlier

Car loans from private lenders continue to be priced higher than those from PSBs.

 

ICICI Bank starts at 8.50 per cent, while HDFC Bank starts from 9.20 per cent, with EMIs beginning at Rs 10,258 and Rs 10,428, respectively.

 

Federal Bank and IDFC FIRST Bank have starting rates of 10 per cent and 9.99 per cent, pushing EMIs above Rs 10,600.

 

Processing fees at private banks are also steeper — ICICI charges up to 2 per cent of the loan amount, and IDFC FIRST Bank charges up to Rs 10,000.

 

Why the rate gap matters

Even a small difference in interest rates can significantly change the total cost of borrowing. For example:

 

An EMI of Rs 10,043 at UCO Bank’s lower band

 

Versus Rs 10,621 at IDFC FIRST Bank’s lower band

 

creates a monthly difference of nearly Rs 600, adding up to  Rs 36,000 over a five-year tenure.

 

Borrowers should review:

 

Interest rate range across lenders

 

Processing charges and ongoing waivers

 

Concessions for existing customers

 

Prepayment rules and charges

 

With PSBs offering lower rate bands and multiple fee waivers, value-conscious borrowers may find better affordability in the public sector segment.