SBI Hikes Interest Rates of Car Loans by 50 Bps
SBI’s official website shows its car loan interest rate as 11.25 %. On the otherhand, Competitors banks like ICICI Bank, HDFC Bank and Axis Bank car loan rates are .25 to 4% higher, based on tenure and the amount of loan.
At present, SBI offers cheaper car loan than other banks. SBI is not to change its rate for two-wheeler loans. The bank incurs higher per unit cost due to small ticket size and higher risk of defaults.
| CAR LOAN RATES OF Major Banks |
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| Banks |
Rate range in %* |
Processing fee in Rs * |
| ICICI Bank | 11.5-17.00 | 2,500-5,000 |
| HDFC Bank | 11.5-12.25 | 2,325-4,275 |
| Axis Bank | 11.5-14.25 | 3,000-3,500 |
| SBI Bank | 11.25 | 0.5% loan amount |
| *Rates and processing changes vary based on amount and tenure Source: Bank websites and deal4loans.com |
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SBI car loan portfolio stood at Rs 22,025 crore in September 2011, showing a growth of 25.25 % over September 2010.
Its pace, however, showed a moderate rise in the first six months of this financial year. Its car loan grew by just Rs 1,115 crore. The auto loan portfolio at the end of March 2011 was Rs 20,910 crore.
The bank’s annual growth in lending for purchasing of vehicles declined to 17.9 per cent in November 2011 from 25.57 % in the year-ago period. The car loan portfolio of banks was Rs 86,877 crore in November 2011, according to the RBI.
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