Nov-end car loans start at 7.6%: Check top 20 offers from banks & NBFCs

Customers should compare the total cost of borrowing, not just the headline rate

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People planning to avail year-end discounts on car loans should compare interest rates and processing fees to keep their monthly outgoings predictable. Banks and non-banking financial companies (NBFCs) are offering competitive vehicle loan options, according to rate and EMI data sourced from Paisabazaar.com (as of November 26).

 

Public-sector banks' car loan rates

 

Most large public-sector banks price their entry-level rates between 7.60 per cent and 7.85 per cent per annum, making them the most cost-effective choices for borrowers with steady incomes and strong credit histories.

 

Notable options include:

 

• UCO Bank: 7.60–10.25 per cent; zero processing fees on all car and EV loans.

• Canara Bank: 7.70–11.70 per cent; full processing fee waiver until 31 December 2025.

• Bank of Maharashtra: 7.70–12.00 per cent with a 0.25 per cent fee (Rs 1,000–15,000).

• Union Bank of India and Punjab National Bank: 7.80–9.70 per cent.

• Indian Bank: 7.75–9.85 per cent.

 

On a Rs 5-lakh loan over five years, EMIs for these lenders start at about Rs 10,040, rising marginally with higher rate slabs.

 

Private banks and NBFCs

Private banks continue to operate at higher starting points, typically above 8.50 per cent.

• ICICI Bank: 8.50 per cent onwards; processing fee up to 2 per cent.

• HDFC Bank: 9.32 per cent onwards; up to 1 per cent in charges.

• Federal Bank: 10 per cent onwards.

NBFCs exhibit the widest variation in pricing and are considerably more expensive at the upper end.

• Tata Capital: 9.49 per cent onwards.

• Bajaj Finserv: up to 19 per cent.

• Shriram Finance: 10–28 per cent.

• HDB Financial Services: 8–26 per cent.

 

For the same Rs 5-lakh, five-year loan, EMIs can reach above Rs 15,000 where rates exceed 20 per cent.

 

Processing fees matter more than expected

Several public-sector banks are offering concessions or full waivers on processing charges, which can reduce the effective cost of borrowing. In contrast, private banks and NBFCs typically levy between 1 per cent and 5 per cent of the loan amount, significantly increasing upfront expenses.

 

What car buyers should consider now

• Compare the total cost of borrowing, not just the headline rate.

• Use limited-period waivers, such as those from Canara Bank and Central Bank of India, to lower upfront charges.

• Balance cost with convenience; NBFCs may offer faster disbursal but at much higher rates.

 

With year-end promotions underway, borrowers who negotiate well and maintain strong credit profiles may secure additional concessions, even though the broader rate structure is likely to remain steady.