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Two Wheeler Loan

If you’re looking to take a loan to buy a motorbike, check out the various two-wheeler loans available to you. Take a look at some of the banks that offer you these loans. Compare interest rates, processing fees, and your EMIs. Read on to find out the best option for you.

Two Wheeler Loan Interest Rates for all Banks

TWL Banks Interest Rate Loan Amount Processing Fees
State Bank of India 16.05% p.a. Rs.30,000 to Rs.2.50 lakh 2% of the loan amount + GST
Bank of India 7.35% to 8.55% Up to Rs.50 lakh Rs.500 to Rs.10,000
HDFC Bank 20.90 % Rs.20,000 to Rs.2 lakh 3% of Loan Amount
Punjab National Bank 8.7% to 10.05% Up to Rs.1.5 lakh Rs.500 to Rs.1,000
Andhra Bank 9.90% to 10.00% Up to Rs.10 lakh At the discretion of the bank
Union Bank of India 9.9% to 10% Up to Rs.10 lakh NIL
Corporation Bank 9.90% to 10.00% Up to Rs.10 lakh At the discretion of the bank
Axis Bank 10.80% - 28.30% Rs.20,000 onwards Up to 8% of the loan amount

State Bank of India

Key Highlights:

  • Get loans for both regular two-wheelers as well as superbikes.
  • Get easy loans with low minimum income requirements.
  • Repayment tenure of up to 3 years.
Interest rate EMI Processing fee Payment
16.05% p.a. Rs.3,518 2% of the loan amount Rs.1,28,654

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 16.05% p.a., and a tenure of 3 years. The processing fee percentage has also been factored into the EMI calculation. The interest rate may change at the bank’s discretion.

Bank of India

Key Highlights:

  • Loans available for both normal two-wheelers and superbikes as well.
  • Financing is available for new 2-wheelers and used 2-wheelers.
  • Repayment period of up to 5 years.
Interest rate EMI Processing fee Payment
7.35% p.a. Rs.1,997 1% of the loan amount (minimum Rs.500 & maximum Rs.10,000) Rs.1,20,300

Note:The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 7.35% p.a., and a tenure of 5 years. The processing fee percentage has also been factored into the EMI calculation. The interest rate mentioned in the table is the current rate of interest charged by the bank.

HDFC Bank

Key Highlights:

  • Get financing of up to 100% of the value of your vehicle.
  • Enjoy flexible repayment options.
  • Get fast and easy loan approvals and disbursements.
  • Online loan application process
Interest rate EMI Processing fee Payment
20.9% p.a. Rs.3,091 Maximum 3% of the loan amount Rs.1,51,377

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 20.9% p.a., and a tenure of 4 years. The processing fee percentage (3%) has also been factored into the EMI calculation. The interest rate may change at the bank’s discretion.

Punjab National Bank

Key Highlights:

  • Special 2-wheeler loan scheme for women borrowers.
  • Extended repayment period of up to 5 years (60 months) for scooters and motorcycles.
  • Low minimum monthly income criterion.
Interest rate EMI Processing fee Payment
9.55% Rs.2,103 0.5% of loan amount
Rs.1,000
Rs.1,27,158

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 9.55% p.a., and a tenure of 5 years. The processing fee percentage has not been factored into the EMI calculation. The interest rate may change at the bank’s discretion.

Andhra Bank

Key Highlights:

  • Loan can be availed by an individual, joint, or along with the members of your family.
  • Repayment tenure of up to 3 years.
  • There is no prepayment fee if you prepay using your own funds.
Interest rate EMI Processing fee Payment
9.90% p.a. to 10.00% p.a. Rs.3,222 NIL Rs.1,15,993

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 9.90% p.a., and a tenure of 3 years.The interest rate may change at the bank’s discretion.

Andhra Bank has merged with Union Bank of India, so the interest rate charged by the latter will be considered.

Union Bank of India

Key Highlights:

  • The bank offers up to Rs.10 lakh for purchasing two-wheelers.
  • There is no prepayment fee if you prepay using your own funds.
  • Repayment tenure of up to 3 years.
Interest rate EMI Processing fee Payment
9.90% p.a. to 10.00% p.a. Rs.3,222 NIL Rs.1,15,993

Note:The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 9.90% p.a., and a tenure of 3 years. The interest rate may change at the bank’s discretion.

Corporation Bank

Key Highlights:

  • Get up to Rs.10 lakh to buy the motorbike you want.
  • Get financing for two wheeler insurance, registration, and accessories as well.
  • Repayment tenure of up to 3 years.
  • There is no prepayment charges if you prepay using your own funds.
Interest rate EMI Processing fee Payment
9.90% p.a. to 10.00% p.a. Rs.3,222 NIL Rs.1,15,993

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 9.90% p.a., and a tenure of 3 years. The interest rate may change at the bank’s discretion.

Corporation Bank has been integrated with Union Bank of India, hence the interest rate charged will be by the latter.

Axis Bank

Key Highlights:

  • Get financing of up to 100% of the value of your vehicle.
  • Repayment tenure of up to 4 years.
  • You can apply online for a two-wheeler loan
Interest rate EMI Processing fee Payment
10.80% - 28.30% Rs.2,575 NIL Rs.1,31,593

Note: The figures in the table above have been calculated based on a principal amount of Rs.1,00,000, an interest rate of 10.80% p.a., and a tenure of 4 years. The processing fee percentage (8%) has been factored into the EMI calculation. The interest rate may change at the bank’s discretion.

Two-wheeler loan eligibility

Lenders have certain eligibility criteria they expect you to fulfil before they process your application. These may vary from one lender to another. Some of the general eligibility criteria are as follows:

Requirements Salaried Individuals Self-employed individuals
Age Minimum – 21 years at the time of application Maximum – 65 to 70 years at the end of the loan tenure Minimum – 21 years at the time of application Maximum – 65 to 70 years at the end of the loan tenure
Monthly income Rs.7,000 Rs.6,000
Credit score Above 750 Above 750
Loan amount Up to 100% of the value of the vehicle Up to 100% of the value of the vehicle
Residential stability Must be staying at the current address for at least 1 year Must be staying at the current address for at least 1 year
Work experience At least 1 year At least 1 year

Note: These criteria may be different for different lenders. Check with the lender of your choice before applying.

Documents required for two-wheeler loans

Every lender requires you to submit certain documents while applying for a loan. Some of the general documents required are given below:

Particulars Salaried Individuals Self-employed individuals
Identity Proof PAN card, voter’s ID, passport, driving license PAN card, voter’s ID, passport, driving license
Address Proof Utility bills, passport, etc. Utility bills, passport, etc.
Income Proof Salary slips, IT returns, bank statements Bank statements, IT returns, audited financial statements

Note: The documents required may differ from one lender to another. Check with your lender for what they require you to submit.

What are the advantages of taking a two-wheeler loan?

Applying for a loan to buy the bike you’ve always wanted can benefit you in a number of ways. Some of them include:

  • Get the funds you need to buy the bike you want.
  • Use a guarantor or co-applicant to get the money you need.
  • Get funds to buy superbikes as well.
  • Get affordable interest rates.
  • Enjoy a wide spectrum of loan repayment periods.
  • Repay your loan in affordable EMIs.
  • Pay every EMI on time and build your credit history.

Use BankBazaar’s two-wheeler EMI calculator to know your EMI

BankBazaar brings you a unique EMI calculator to help you find out exactly what your EMI will be. The tool helps you find out how much you have to repay every month in just a few minutes. The steps of how to use this tool are given below:

  • All you need to do is to input the amount you want to borrow, select the interest rate charged by the lender, and the tenure of the loan.
  • You can also select whether or not you intend to prepay parts of your loan. Also, you can type in any processing fees that you have to pay.
  • After this, simply hit “Calculate”. Your EMI will be shown in a few seconds. You will also get the amortisation table for your loan. This table will show you how you have to repay the loan over the tenure you’ve chosen.
  • The table will show you the interest and principal components of each EMI along with how much interest you will pay over the loan period. This helps you find out how much the loan will cost you.

Tips for successful two-wheeler loan application

A few loan applicants have had their applications rejected by lenders. This is not a pleasant feeling, nor is it good for your credit score. We’ve put together a list of tips that can help you apply successfully for a two-wheeler loan. These are as follows:

  • Determine the exact loan amount required: You should assess your needs and calculate exactly how much money you need to buy the bike you want. You should never apply for an amount larger than what you need.
  • Check your eligibility and compare your options: Once you decide how much money you need to borrow, take a look at all the loan options that you are eligible for. This is important. Never apply for a loan for which you don’t qualify. This will automatically get your application rejected. Check your eligibility for a two-wheeler loan and make sure you fulfil all the criteria.
  • Check your credit score: Your credit score is one of the most important factors that determine loan approval. Lenders usually reject applications with low credit ratings. So, if your credit history is poor, look at improving it before applying for the loan.
  • Get a guarantor or co-applicant: If your credit score is not up to the requirement of the lender, see if you can get a guarantor or co-applicant. Having a guarantor or co-applicant who has good credit can help you get the loan you want.
  • Fill your loan application properly: Make sure your application is fully filled with all the details your lender requires. An incomplete application or an application that has wrong information may be rejected.
  • Submit all the necessary documents: While submitting your loan application, make sure you submit all the documents the lender requires as well. If you don’t submit the required papers, your application may be rejected.
  • Try applying with your existing lender: If you already have a good existing relationship with a bank, try taking the loan from them. This good standing may help you get a loan even if you don’t fulfil all their criteria.

Points to remember while applying for a two-wheeler loan

Now that you know how you can successfully apply for a motorbike loan, let’s check out what you need to keep in mind while applying for one. These points can help you find the right loan and avoid paying more than you should.

  • Do your research well: This is the first step before you apply for a motorbike loan. Make sure you do your research well. Compare all the options that various lenders offer you. Compare interest rates, processing fees, repayment options, and other loan terms. This will help you find the best and cheapest option.
  • Choose your tenure wisely: The tenure of your loan will determine how much you have to repay each month. Make sure you can afford your EMI. This means you have to be wise about choosing your tenure. A shorter tenure will help repay the loan faster. But your EMIs will be high. So, choose according to how much you can afford to pay off every month without facing a financial crunch.
  • Choose an affordable interest rate: Your interest rate determines the overall cost of your loan. It also has an impact on your EMI. Choosing a loan with a low rate of interest can help keep your EMIs low. It will also make your loan cheaper.
  • Compare floating rates versus fixed interest rates: Some lenders may offer you both floating interest rates as well as fixed interest rates. Floating rates change as per the changes in the market rates. Fixed rates remain constant irrespective of market rate changes. That said, floating rates are usually lower than fixed rates.
  • Compute your EMIs before applying: When you compare your loan options, make sure you compare the respective EMIs as well. Choose a loan that gives you an affordable EMI with a convenient repayment period.
  • Ask about prepayment fees: If you plan on prepaying or foreclosing your two-wheeler loan at any point, find out the charges for the same. Some lenders may charge you a fee for this while others may not. Prepaying your loan can help you save interest costs.
  • Read the terms and conditions properly: This is also called the fine print. Read your loan offer document thoroughly and go through every single term and condition before you sign it. The fine print may reveal hidden charges and fees that may otherwise never be mentioned. Knowing these terms can help you avoid paying heavy penalties.

Do’s and don’ts of applying for a two-wheeler loan

Let’s now look at the do’s and don’ts of applying for this loan.

Do’s Don’ts
Do your research well before you apply Don’t apply for multiple loans at the same time
Make sure you are eligible for the loan you’re applying for Don’t apply for a loan simply because you get an attractive welcome gift
Compare interest rates and find the best option Don’t forget to fill in the application form properly
Compare processing fees and other charges Don’t sign the loan documents without reading them thoroughly
Evaluate your credit score before you apply Don’t choose an EMI you cannot afford
Submit all the required documents without fail Don’t forget to pay your EMIs on time
Read the offer document carefully before signing it Don’t forget to prepay your loan if you can

How to improve your chances of getting a two-wheeler loan

In this section, we’re going to take a look at how you can improve your chances of getting your loan approved. The loan requirements differ from one lender to another. Sometimes, you may find it hard to get the loan you’re looking for. The following suggestions may help:

  • Clean up your credit: Lenders pay a lot of attention to your credit score when evaluating your loan application. If you have a high score, you stand a better chance of getting the loan you want. You should check your credit report every now and then to see if you’re making any errors. Taking corrective steps will help you clean up your credit.
  • Balance your debt-to-income ratio: Your debt-to-income ratio compares your current debt situation to your current income. It shows how much of your monthly income is currently being used to pay off loans and bills. The lower this ratio is, the better are your chances of getting your loan. So, look at paying off a few loans before applying.
  • Get co-signers if needed: Sometimes, getting a co-applicant for your loan can help you get what you’re looking for. This helps especially if you have a poor credit score. You can also get another individual to guarantee the loan on your behalf. Keep in mind that the co-applicant and the guarantor will be held accountable if you don’t repay the loan on time.
  • Don’t apply for multiple loans: When you apply for multiple loans simultaneously, lenders will realise that you may not take the loan they offer. This will make them reject your application. Keep in mind that multiple rejections can hurt your credit rating.

Take a look at some of the most commonly asked questions regarding two-wheeler loans.

Two-wheeler loan FAQs

  1. Can I get a loan to fund the whole value of the vehicle?
  2. The answer to this depends on the lender from whom you take the loan. Most lenders will offer you a loan for only up to around 80% to 90% of the value of the vehicle. You will have to bring in the rest of the money on your own. That being said, there are a few lenders who offer 100% financing. However, this may come at the cost of additional terms and conditions.

  3. Should I choose a floating interest rate or a fixed interest rate?
  4. Sometimes, banks may offer you the choice of a fixed or floating interest rate. A fixed rate remains constant irrespective of market rate changes. A floating rate changes when the market rate changes. People usually prefer taking floating rates because they are lower than fixed rates.

  5. What is two-wheeler loan prepayment? How does prepayment help?
  6. Prepayment is paying an EMI or multiple EMIs together before the amounts are due. Every time you prepay a part of your loan, it helps reduce the outstanding principal. This reduces your interest cost as well. So, prepaying your loan can help you save money.

  7. Should I offer collateral when I take a loan to buy a 2-wheeler?
  8. No, you don’t have to offer collateral when you take this loan. The vehicle acts as collateral till you repay the loan in full. This is called hypothecation.

  9. What will happen if I am not able to repay my loan on time?
  10. If you don’t pay the EMIs on time, the bank may repossess your vehicle. Since your bike or scooter is hypothecated, the bank has every right to confiscate your vehicle to make good the losses they suffer.

  11. Can I get a loan if I’m a student and have no income?
  12. Yes, you may be able to get a loan if you’re a student. In such cases, you can get a co-applicant such as a parent or a close relative to guarantee payment on your behalf. Do keep in mind that not all lenders offer loans to students.

Two Wheeler News

  • Revealed: 2021 Honda Forza 350 maxi scooter

    The new version of Honda Forza 350 has been introduced and the latest model has a few changes in features and many more colour options. The 2021 Honda Forza 350 has the Honda Smartphone Voice Control (HSVC) and this works via the Honda RoadSync application. It allows you to control the operations of the scooter like accepting calls, music, navigation, etc. The Forza has a switchgear and this allows you to access the functionalities. Other than the HSVC, the Honda 350 cc maxi-scooter has new colour options.

    22 September 2021

  • Yamaha to launch the Aerox 155cc in India on 21 September 2021

    Yamaha is expected to launch the Aerox 155cc in India on 21 September 2021. The bike will be powered by a 155cc engine that will be similar to the one on the R15 V3. However, the power on the Aerox’s engine will be slightly lower. The engine will come with a CVT gearbox. Some of the main features of the bike are 14-inch wheels, Bluetooth connectivity, charging socket, digital instrumentation, LED tail lamp, LED DRLs, and a twin LED headlight. The bike will come with an underseat storage space of 25 litres.

    22 September 2021

  • India Launches TVS Raider 125

    TVS Motor Company has launched the Raider 125 in India and there were a few rumours for the that the bike to be launched was actually the Fiero 125. The new TVS Raider 125 has a lot of features and is powered by a 124.8cc, oil-cooled engine which develops 11 hp of power and 11.2 Nm of torque, and single-cylinder. The TVS Raider 125 was launched in India at a price of Rs.77,500 (ex-showroom). It is a segment-first for a 125cc motorcycle in the country, and the TVS Raider 125 has two ride modes: Eco and Power. The Eco mode is for extracting a good fuel efficiency, and the Power mode is for unleashing the bike. The event of the launch of the bike has now started and the vehicle to be launched today is named the RAIDER 125. The motorcycle will have an all-LED headlamp and LED DRLs.

    20 September 2021

  • Ola Electric S1 and S1 Pro Are up for Sale

    Ola Electric has started the sale of its two electric scooters S1 and S1 Pro, on Wednesday. Buyers who pre-booked the scooters can now choose between the two variants and pick from the ten colours.

    The two electric scooters were launched a month ago and were supposed to start selling from 8 September. But the process got delayed because of some technical issues with the website.

    16 September 2021

  • Yamaha to launch the R15 V4 on 21 September 2021

    Yamaha will launch the R15 V4 in India on 21 September 2021. The bike was spotted earlier and all the changes to the mechanicals and design can be seen. The R15 draws inspiration from the R7 and comes with a new fairing and LED DRLs. Compared to the previous model, the tank looks bigger. The quarter panels in the rear look slimmer and wider when compared to the current model. The biggest change in the bike is the USD fork, which has been added. The bike is expected to cost up to Rs.8,000 when compared to the current model. Therefore, the vehicle should be available at an ex-showroom price of Rs.1.57 lakh.

    16 September 2021

  • TVS teases a new 125cc motorcycle to rival the Pulsar

    TVS will soon launch a new 125cc motorcycle in India. At the moment, the company does not have any 125cc bikes in its line-up. However, they manufacture the Victor and Star City 125 and export them. In India, the only 125-cc two-wheeler the company has is the Ntorq scooter. TVS announced that they will be launching two 125cc two wheelers in the country via social media. The company has filed trademarks for the Retron, Raider, and Fiero. The company has announced that the two-wheeler will be launched in September 2021. The new bike will compete against the likes of the Honda Shine, Splendor Plus, Hero Glamour X-Tec, and the Bajaj Pulsar 125 NS.

    16 September 2021

  • Yamaha updates Street Rally and RayZR models with hybrid tech

    The updated model of the Street Rally 125 Fi Hybrid and RayZR 125 Fi Hybrid has been finally launched by Yamaha in India. One of the major additions to the scooter is the Smart Motor Generator (SMG). It gives an extra power boost to the vehicle when on an incline or while taking off, just like an electric motor.

    The RayZR hybrid model has an engine of 125cc which gives 10.3Nm and 8.2hp. Other changes include a new colour combination, LED headlights, and Bluetooth connectivity. Despite the additions, the weight of the vehicle is not more than 99 kgs.

    The price for Yamaha Street Rally 125 Fi Hybrid model is Rs. 83,830, while the Yamaha RayZR 125 Fi Hybrid model costs Rs. 79,830 for disc brakes and costs Rs. 76,830 for drum brakes.

    8 September 2021

  • Ola Electric partners with financial bodies to provide loan to customers

    Ola Electric has partnered with leading banks and financial institutions, including HDFC Bank, ICICI Bank, Kotak Mahindra Prime and TATA Capital, to offer loans customers for its S1 electric scooter that can be purchased from 8 September 2021. Ola launched the Ola S1 electric scooter in two variants — S1 and S1 Pro — at prices Rs.99,999 and Rs.1,29,999, respectively in August and will start its deliveries in October.

    The process to buy the electric vehicle will be seamless and customers can choose the banks partnered with Ola to finance the purchase of electric scooters.

    Customers who have reserved the purchase of the vehicle can buy it from 8 September onwards by paying the remaining amount and finalise vehicle variant and colour options. The vehicle will then be delivered to the customer’s address.

    8 September 2021

  • New 2021 Aprilia RSV4 and Tuono V4 launched in India

    Piaggio finally launched its two most awaited motor bikes in India - 2021 RSV4 and Tuono 1100. The former is priced at Rs.23,69,000, while the latter will cost Rs.20,66,000, respectively (ex-showroom).

    The RSV4 will provide a power of 1099cc, while the V4 motor will churns out a staggering 210.7bhp of power and 125Nm of peak torque. The Tuono 1100 Factory comes with a 1077cc, offering a power of 170.1bhp and torque at 122Nm. Both these models are compliant with the new BS6 regulations.

    6 September 2021

  • 2021 Royal Enfield Classic 350 is launched in India

    The much-awaited 2021 Royal Enfield Classic 350 has been finally launched on 1 September 2021 in India. The starting price of the model is Rs.1.84 lakh and has a total of 11 colour options across 5 editions. Given the COVID-19 situation, the launch took place virtually. Considered as the company's best-selling model yet, it has sales averaging around 15000 units per day. Around 3 million Classics have been sold worldwide and still counting. The engine used in Classic 350 has multiple components similar to Meteor 350 while some are completely new.

    6 September 2021

  • TVS Motor Company set to launch the 2021 Apache RR 310 in India

    Indian two wheeler giant TVS Motor Company is all set to lift the veil off the 2021 iteration of their sports bike, the Apache RR 310 in the Indian market.

    The motorcycle is expected to come with a revised suspension setup which is likely to offer a preload adjustable front fork like the Apache RTR 200 4V. The engine on the RR 310 is also likely to be upgraded with a retune. Sources have quoted that the new RR 310 might come with a new race ECU which will provide a better throttle response and a racier character to the bike. No changes are expected in the cosmetic end of the motorcycle.

    30 August 2021

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