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    Central Bank of India Used Car Loan Reviews

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    Central Bank of India Used Car Loans

    As a wholly ‘Swadeshi Bank’, Central Bank of India boasts of being the first truly commercial Indian bank which has been providing innovative banking solutions for over a century now. Since its inception in 1911, Central Bank of India has come a long way in growing and strengthening its core businesses transforming every available opportunity successfully into a comprehensive banking solution for customers. The bank was completely nationalized in 1969, with the introduction of a wide range of products and services. The bank’s financial services have been extended across most of the Indian states with a network of 4336 branches and extension counters. Central Bank of India is also a prominent player in assisting with the development of rural areas, promoting the growth of small, medium and large scale industries by introducing various agricultural schemes. Retail banking is a very important facet of its banking services, with the bank providing an entire array of solutions ranging from loans, deposits and cards. Central Bank of India is a major lender of motor loans in India at competitive interest rates, available for all kinds of four wheelers.

    Features of a Central Bank of India Used Car Loan

    Central Bank of India finances all models of used cars not older than 5 years and with an expected life of 10 years as per the valuation report provided. Central Bank of India used car loans can be procured for vehicles taken for personal use only and the bank does not finance any vehicle purchased for hiring or ferrying passengers.

    Quantum of Finance

    Central Bank of India finances up to 24 times the gross monthly salary for an employed professional based on the last salary that has been drawn. Self-employed entrepreneurs will be sanctioned a loan up to two times the average annual income of the last two years. Corporate firms, proprietorships and societies will be granted a used car loan amounting up to three times the average annual cash accrual as per the P/L statements and the audited balance sheet of the company for the last two years.

    Central Bank of India has a cap on the maximum loan amount for used car loans with the amount not exceeding Rs 10 lakhs.

    Loan Margin

    Borrowers are expected to provide a margin of 25% for used car loans and should also furnish the valuation report of the old car from an approved automobile engineer.


    As security for a used car loan, hypothecation of the vehicle purchased is required and the hypothecation charge should also be registered with the RTO authorities.


    Central Bank of India used car loans can be re-paid with two loan tenures depending on the age of the vehicle. For used vehicles aged up to 3 years, loan tenures can be extended up to a maximum of 60 months. Loan tenures can be taken only up to a maximum of 48 months for vehicles aged above 3 years.

    Processing Fees

    Central Bank of India levies a processing fee of 0.50% of the loan amount with the minimum being Rs 2000/- and the maximum being Rs 20,000/- for used four wheelers.


    Borrowers do not have to provide a personal guarantee for used car loans amounting up to Rs 5 lakhs. Any loan amount above that will require a guarantor.

    Prepayment Charges

    Central Bank of India does not impose any pre-payment penalty on borrowers closing their used car loans from their own sources. However, the bank will charge a penalty of 1% of the outstanding balance on loans closed by using funds from other banks or financial institutions.

    Net Take Home Pay Criteria

    Applicants are required to fall into any one of the below given net take home pay criteria to qualify for a Central Bank of India used car loan.

    Annual Income Net Take Home Pay
    Up to 5 lakhs 35% of the Gross Monthly Income
    5 lakhs to 10 lakhs 30% of the Gross Monthly Income
    Above 10 lakhs 25% of the Gross Monthly Income

    Eligibility criteria for a Central Bank of India Used Car Loan

    Applicants are required to be atleast 18 years or above to qualify for a Central Bank of India used car loan. Central Bank of India sanctions used car loans for the following types of applicants.

    • Permanent Central / State Government employees
    • Defense staff
    • Employees of PSUs
    • Corporate firms and establishments
    • Independent entrepreneurs with a regular source of income
    • Agriculturists / Farmers engaged in production
    • Non-resident Indians as a joint loan with a local Indian resident
    • Central Bank of India staff
    • Corporates / Proprietorships / Partnership Firms

    Salaried individuals are required to have a minimum monthly income of Rs.15, 000/- to qualify for a Central Bank of India used car loan. All other types of applicants have to show an annual income of Rs.1, 80,000/- to be eligible for a used car loan. Borrowers can also take a joint used car loan with a family member having a regular source of income. The income of the co-borrower can be clubbed with the primary applicant to calculate the eligibility criteria.

    Documents required

    1. Original salary slip for one month
    2. Undertakings from the employer
    3. Guarantor’s consent letter (if required)
    4. Authority letter to the Employer for monthly loan deductions and salary remittance
    5. Income Tax Returns
    6. Income Tax Assessment Order
    7. Form 16
    8. Proforma Invoice from the dealer
    9. Bank Accounts Statements
    10. Landholding Details (For Farmers)

    Central Bank of India Used Car Loan Interest Rates

    Central Bank of India’s “Cent Vehicle Loan” can be used to purchase a second-hand car for personal use. Interest on this loan will be charged either by considering the Base Rate or MCLR, with new customers automatically enrolled under MCLR. Existing borrowers can choose between MCLR and base rate based interest, depending on their requirements.

    Central Bank of India Marginal Cost of Funds Based Lending Rate (MCLR) (For new borrowers)

    Following the RBI’s notification, Central Bank of India has introduced MCLR based interest rates, with new borrowers expected to pay interest according to this method. MCLR takes factors like repo rate, lending environment, economic stability, etc. into account while computing the rate. The table below highlights the current rates.

    MCLR Benchmark Tenure (Period) Benchmark Rates (MCLR)
    Overnight 9.00%
    1 month 9.30%
    3 months 9.40%
    6 months 9.45%
    1 year 9.50%

    Used car loan interest rates – May 2016

    Central Bank of India can add a certain percentage over and above the MCLR for a particular tenure, with the final rate depending on a number of factors.

    Central Bank of India Base and Prime Lending Rates (For existing borrowers)

    Base Rate 9.70% per annum, effective 08/10/2015
    Prime Lending Rate 15% per annum, effective 01/08/2011

    Central Bank of India interest rate for used cars (Based on Base Rate)

    Current customers of “Cent Vehicle Loan” have the option of migrating to a MCLR based system. Those who wish to continue with the old system are required to pay an interest determined by the base rate.

      Fixed Rate Floating Rate
    Interest Rate BR + 1.50% per annum BR + 1.50% per annum

    Note: Interest rates are subject to change and applicants should check prevailing rates while applying. The rates mentioned here are valid as of June 6, 2016, with Central Bank of India having the discretion to modify them without prior notice.

    EMI calculator for Central Bank of India Used Car Loans

    Understanding the cost associated with a used car loan is always important while planning on an investment. Borrowers should always have a fair idea of how much they would spend on a car loan inclusive of the interest rate and the EMI expenses. Various tools are available to provide borrowers with a detailed estimate of their car loan expenses and a car loan EMI calculator is one such tool. BankBazaar’s used car loan EMI calculators efficiently calculate the interest rates and EMIs for a Central Bank of India car loan with only a few inputs from the customers. The used car loan EMI calculator is present under the “Finance Tools” menu on the homepage of BankBazaar.com. Customers are required to input certain details like loan amount, processing fees, tenure and the interest rates charged by Central Bank of India on used car loans to get an elaborate forecast of their car loan repayment schedule.

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