Car loan rates this July: 7.60%-14.25%, check bank-wise rates & charges

EMIs from ₹10,043 for a ₹5 lakh, 5-year loan; check July car loan rates, festive fee waivers and lender-wise charges before applying.

If you’re planning to buy a new car this monsoon, it’s worth looking closely at how car loan rates stack up this July. According to data from Paisabazaar.com, public sector banks continue to offer some of the most competitive interest rates, though private lenders bring in flexibility with quicker processing.

  Here’s a look at what borrowers need to know about the current rates and charges before signing up for a loan.

 

Public banks keep rates low, with fee waivers

Among public sector lenders, Canara Bank is offering rates between 7.70-11.70 per cent p.a. with a special offer: a 100 per cent waiver on processing fees under its Retail Loan Festival running from July 1 to September 30, 2025. Similarly, Union Bank of India has rates ranging from 7.80-9.70 per cent p.a., with a flat processing fee of up to Rs 1,000.

 

 

Punjab National Bank (PNB) and UCO Bank also remain competitive with starting rates of 7.85 per cent and 7.60 per cent, respectively. PNB charges up to 0.25 per cent (Rs 1,000-1,500) as a processing fee, while UCO Bank’s fee is slightly higher at 0.50 per cent (Rs 5,000).

 

Here’s a snapshot of some public lenders’ offers:

 

• State Bank of India (SBI): 8.90-9.95 per cent p.a., processing fee of Rs 750-Rs 1,500. 
• Bank of Maharashtra: 7.70-12.00 per cent p.a., 0.25 per cent processing fee (max Rs 15,000), with 0.25 per cent rate concession for existing home loan borrowers. 
• Indian Bank: 7.75-9.85 per cent p.a., processing fee Rs 1,000.

 

What are private banks offerings

Private sector banks typically charge higher rates. ICICI Bank starts at 9.10 per cent p.a. with processing fees of up to 2 per cent of the loan amount. HDFC Bank’s rates start from 9.20 per cent p.a., charging up to 1 per cent (Rs 3,500-Rs 9,000) in processing fees.

 

IDFC First Bank and Federal Bank have rates beginning at 9.99 per cent p.a. and 10.40 per cent p.a. respectively.

 

Borrowers eyeing private lenders should be prepared for:

 

Higher EMIs: Starting from Rs 10,403 (ICICI Bank) for a Rs 5 lakh loan over 5 years.

 

Steeper charges: Processing fees can go as high as Rs 10,000-Rs 11,000 in some cases.

 

Below is a detailed table of rates and approximate EMIs for a Rs 5 lakh loan with a 5-year tenure.

 

NEW CAR LOAN-RATES AND CHARGES
Name of Lender	Interest rate (%) p.a.	EMI (Rs)  Loan amount-5 lakh  Tenure-5 years	Processing fee  (% of loan amount)
Union Bank of India	7.80-9.70	10,090 - 10,550	Up to Rs 1,000
Punjab National Bank	7.85-9.70	10,102 - 10,550	Up to 0.25% (Rs. 1,000 - Rs. 1,500)
Bank of Baroda	8.15-11.70	10,174 - 11,047	Up to Rs. 2,000
Canara Bank	7.70-11.70	10,067 - 11,047	0.25% (Rs 1,000 - Rs. 5,000)  (100% waiver on processing fee under Retail Loan Festival from 01.07.2025 to 30.09.2025)
Bank of India	8.00-12.15	10,138 - 11,160	Up to 0.25% (Rs. 2,500 - Rs. 10,000)
UCO Bank	7.60-10.00	10,043 - 10,624	0.50% (Rs 5,000)
State Bank of India	8.90-9.95	10,355 - 10,611	Rs 750 - Rs 1,500
IDBI Bank	8.40-9.20	10,234 - 10,428	Rs 2,500
Bank of Maharashtra*	7.70-12.00	10,067 - 11,122	0.25% of the loan amount (max. up to Rs. 15,000)
Indian Overseas Bank	7.80-12.00	10,090 - 11,122	0.50% (Rs 500 - Rs 5,000)
ICICI Bank	9.10 onwards	10,403 onwards	Up to 2%
HDFC Bank	9.20 onwards	10,428 onwards	Up to 1% (Rs 3,500 - Rs 9,000)
Karnataka Bank	9.16-11.64	10,418 - 11,031	Up to 0.60% (Rs 2500 - Rs 11,000)
Federal Bank	10.40 onwards	10,722 onwards	Rs 2,000 - Rs 4,500
Punjab and Sind Bank**	7.75-14.25	10,078 - 11,699	0.25% (Rs 1,000-Rs 15,000)
Indian Bank	7.75-9.85	10,078 - 10,587	Rs. 1000
IDFC First Bank	9.99 onwards	10,621 onwards	Up to Rs 10,000
Central Bank of India	7.85-9.45	10,102 - 10,489	0.50% of loan amount (Rs. 2,000 - Rs.20,000)
*0.25% interest rate concession for existing home loan borrowers and other existing customers having atleast 6 months of relationship with the bank.
**Concession of up to 50% on processing fee for PSB Apna Vahan Sugam.
Rates and charges as of 16th July 2025.
Source: Paisabazaar.com

 

What should you watch out for?

 

Compare EMIs: For a Rs 5 lakh loan over 5 years, EMIs can vary between Rs 10,043 (UCO Bank) and Rs 11,699 (Punjab and Sind Bank), depending on the bank and rate.

 

Processing fee waivers: Take advantage of offers like Canara Bank’s zero processing fee scheme.

 

Relationship discounts: Some banks, like Bank of Maharashtra, offer concessions for existing customers.

 

Bottom line

If affordability is key, public sector banks may be your best bet this July, especially with different concessions and fee waiver offerings. However, if speed and flexibility matter more, private lenders, despite higher costs, could suit your needs. Compare rates and charges carefully before taking the plunge.