Two Wheeler Loan Interest Rate - Compare Bike Loan Interest Rate 2020
Two wheeler loan interest rate

Two Wheeler Loan Interest Rate – Compare Bike Loan Interest Rate 2020

You might be looking for a cheaper two wheeler loan for your next bike. But there is no fixed interest rate charged by banks on the two wheeler loan. There are a few factors banks consider while finalising the bike loan interest rate. 

These factors includes 

  • Profession – If you are a salaried person, you are likely to lower interest rates as compared to a non-working or a business professional.
  • Vehicle Type- Interest varies depending on the type of vehicle like a Honda Activa attracts a different rate of interest as compared to a Bajaj Pulsar.
  • Credit History – Your good CIBIL score is also another tool to provide you cheaper interest offers. Because a high CIBIL score reflects your better repayment capacity based on your past behavior.

The interest rate on a two wheeler loan ranges between 7.75% up to 29% per annum. Let’s discuss the bike loan interest rates in detail.

Lowest Two Wheeler Loan Interest Rate

#1. Bank of India

BOI is providing the two wheeler loan interest rate at the lowest prices in India. BOI bike loan interest rate is just 7.75% that climbs up to 8.35%

Bank of India decides two wheeler interest rate as per the applicant’s CIBIL score as a major factor. So if your CIBIL is above 800, you can avail the lowest interest rates.

#2. Bajaj Finance 

Bajaj is the 2nd cheap finance company that offers you bike loan interest at the starting rate of 7.85% that goes up to 18%. Bajaj Auto finance allows a minimum loan amount of Rs.30,000.

You must follow the criteria below to get the loan approval.

  • Your age should be between 21-65 years.
  • Your monthly income should be at least Rs. 12,500.

#3. IDBI Bank

IDBI bank is providing bike loan interest rate as low as 8.40% that goes up to 9.80%

IDBI, in a similar fashion to Bank of India, fixes two wheeler interest rate as per the applicant’s CIBIL score as a major factor. 

So if your CIBIL is above 760, you can avail of the lower interest rates.

Check out – Mudra loan Interest rates in 2020

Two Wheeler Loan Interest Rate Of Different Banks

#1. HDFC Two Wheeler Loan Interest Rate

HDFC is popular bank that provides various services including bike loans. Bike loan interest rate of HDFC is slightly higher than Bank of India and IDBI bank.

You can, however, negotiate with your bank if you are an old valuable customer of the bank. You will get some waiver. The interest rates that HDFC bank offers are as below.

HDFC two wheeler loan interest rate 

HDFC bank two wheeler loan interest rate varies in the range of minimum 11.83% to maximum of up to 26.83%.

HDFC bike loan other charges  

Apart from loan interest rate that you have to pay against the loan amount. There are certain charges that bank charge while applying for a two wheeler loan.

These charges are as below.

  • Processing Fee – 3% of credit amount 
  • Documentation Fee – 3% of credit amount as documentation fee
  • Pre-payment closure Fee – If you want to close the loan in between the loan tenure, you have to pay some “Pre-payment fee” to close the loan. It varies depending on the tenure you have completed. 
    • No prepayment closure allowed in first 3 months
    • Closing within 4th EMI to 6th EMI – 10% of the outstanding amount
    • Closing within 7th EMI to 12th EMI –  6% of principal outstanding
    • Closing within 13th EMI to 24th EMI – 5% of principal outstanding
    • 24th EMI onwards – 3% of principal outstanding

HDFC two wheeler loan eligibility

  • A salaried or self-employed individual with a minimum 21 years of age up to 65 years age at the end of the loan tenure
  • Minimum monthly salary for salaried person – Rs. 7,000 
  • Minimum monthly income for self-employed – Rs. 6,000/- 
  • Resident proof for a minimum of 1 year at the given residence
  • Income proof like ITR, or salary slip to prove for a minimum of 1 year of working

#2. SBI Two Wheeler Loan Interest Rate

SBI bank offers a cheaper two wheeler loan as compared to its counterparts like PNB or HDFC, 

What SBI is offering in bike loan interest rates is as below.

SBI two wheeler loan interest rate 

State bank of India offers bike loan interest rates in the range of 10.65% to 16.45%. The repayment tenure is a maximum of 36 months.

SBI bike loan other charges  

Other charges that bank charge while applying for a two wheeler loan.

  • Processing Fee – 0.4% of credit amount or min. Rs. 1,000.
  • Documentation Fee – Rs. 1,000
  • Pre-payment closure Fee – 1% of principal outstanding If closed within 24 months from the date of disbursement.

SBI two wheeler loan eligibility

  • The age of the applicant should be between 21-65 years.
  • Minimum monthly income – Rs. 12,500 
  • Minimum loan amount – Rs.30,000
  • Resident proof for a minimum of 1 year at the given residence
  • Income proof like ITR, or salary slip to prove for a minimum of 1 year of working

#3. Bajaj Finance Two Wheeler Loan Interest Rate

Bajaj Auto finance gives very tough competition to SBI with slightly lesser interest rates on the bike loan.

Bajaj Finance two wheeler loan interest rate 

Bajaj Auto Finance two wheeler loan interest rate starts from 7.85% with a maximum limit of 18%. You can repay in a maximum of 36 months from the date of loan approval.

Bajaj Finance bike loan other charges  

  • Processing Fee – 1% – 3.5% of credit amount.
  • Documentation Fee – 3.5% of credit amount as documentation fee
  • Pre-payment closure Fee – As per the company rules

Bajaj Finance two wheeler loan eligibility

  • The age of the applicant should be between 21-65 years.
  • Minimum monthly income – Rs. 12,500 
  • Minimum loan amount – Rs.30,000
  • Resident proof for a minimum of 1 year at the given residence
  • Income proof like ITR, or salary slip to prove for a minimum of 1 year of working

#4. ICICI Bank Two Wheeler Loan Interest Rate

You can apply for an insta loan at ICICI to buy your dream bike. ICICI offers you an instant loan if you are already an ICICI bank customer and your minimum annual income is Rs. 84,000.

ICICI two wheeler loan interest rate 

ICICI bank two wheeler loan interest rate varies in the range of a minimum of 10% to a maximum of up to 26%.

ICICI bike loan other charges  

  • Processing Fee – 2.5% of the Loan amount or Rs. 2500/-
  • Documentation Fee – Rs 2.25% of the loan amount 
  • Pre-payment closure Fee – 5% on principal outstanding

ICICI  two wheeler loan eligibility

  • A minimum of 21 years of age up to 65 years age \
  • Minimum monthly salary for a salaried person – Rs. 7,000 
  • Minimum monthly salary for self-employed – Rs. 6,000/- per year for a self-employed profile
  • Resident proof for a minimum of 1 year at the given residence
  • Income proof like ITR, or salary slip to prove for a minimum of 1 year of working

#5. IDFC First Two Wheeler Loan Interest Rate

IDFC First gives you up to 95% loan against your two wheeler’s value which means if your bike’s value is Rs. 50,000, you can get your bike home by paying just Rs. 2,500 and for the rest of the amount you take the loan.

IDFC First bike loan interest rate 

Capital First or IDFC First bank two wheeler loan interest rate varies in the range of a minimum of 10.75% to 22.00% at max.

IDFC First two wheeler loan other charges  

  • Processing Fee – up to Rs. 2000/-
  • Documentation Fee – Rs 1.5% of the loan amount 
  • Pre-payment closure Fee – As per bank rules

IDFC First two wheeler loan eligibility

  • A salaried or self-employed individual with a minimum of 18 years of age
  • Minimum 6 months in job or 2 years in business
  • Residing at the given residence for atleast 1 year
  • A minimum of 6 months of job or 3 year of business.

#6.Indusind Bank Two Wheeler Loan Interest Rate

You can apply for a bike loan online from the bank’s website and the whole process is paperless. You have to register with the bank to start the application process.

IndusInd Bank bike loan interest rate 

IndusInd Bank two wheeler loan interest rate varies in the range of a minimum of 12.00% to 29.00% at max.

IndusInd Bank two wheeler loan other charges  

  • Processing Fee – up to Rs. 2000/-
  • Documentation Fee – Rs 1.5% of the loan amount 
  • Pre-payment closure Fee – 5% on principal outstanding

IndusInd Bank two wheeler loan eligibility

  • A salaried or self-employed individual with a minimum of 21 years of age
  • Minimum monthly income  – Rs. 10,000
  • Residing at the given residence for at least 1 year
  • A minimum of 1 year of job or 3 years in business.

#7. Axis Bank Two Wheeler Loan Interest Rate

Axis bank gives you an auto loan as low as Rs. 20,000. You can repay the loan in 3 years. 

Axis Bank two wheeler loan interest rate 

Axis Bank  two wheeler loan interest rate varies in the range of 11.00% to 28.50%

Axis Bank bike loan other charges  

  • Processing Fee – Up to 8% of the credit amount 
  • Documentation Fee – Rs.1500
  • Pre-payment closure Fee – Closing within 0 to 12 months –  10% of principal outstanding. Closing after 12 months onwards – 5% of principal outstanding

Axis Bank two wheeler loan eligibility

  • Minimum age 21 years of age up to 65 years age 
  • Minimum monthly salary for the salaried person – Rs. 7,000 
  • Minimum income for self-employed – Rs. 1,50,000/- per year 
  • Minimum one year in job or business
  • Last 3 months bank statement

#8. Bank Of Baroda Two Wheeler Loan Interest Rate

Bank of Baroda offers quite a low bike loan interest rate starting from 8.85%. You can also get the loan sanctioned up to Rs. 10 lakh if you want to buy even a premium bike that you have to repay in 60 months. 

Bank Of Baroda two wheeler loan interest rate 

Bank Of Baroda two wheeler loan interest rate varies in the range of 8.85% to 14.25%. 

Bank Of Baroda bike loan other charges  

  • Processing Fee – 2% of the loan amount
  • Documentation Fee –  No charges
  • Pre-payment closure Fee – As per bank rules.

Bank Of Baroda two wheeler loan eligibility

  • Minimum age 21 years of age up to 70 years age 
  • Minimum income – Rs. 50,000 per year 
  • Minimum one year in job or business
  • Last 3 months bank statement

#9. PNB Two Wheeler Loan Interest Rate

PNB gives a special loan offer to women. Another benefit is that PNB doesn’t charge any prepayment closure fee if you want to close the loan before its maturity date.

PNB two wheeler loan interest rate 

Punjab National Bank two wheeler loan interest rate is 10.70% to 13.70%. You can repay the loan in a maximum of 5 years.

PNB bike loan other charges  

  • Processing Fee – 0.50% of the loan amount
  • Documentation Fee – 0.50% of the loan amount
  • Pre-payment closure Fee –  PNB doesn’t charge any prepayment penalty fee.

PNB two wheeler loan eligibility

  • Minimum age 18 years of age up to 70 years age 
  • Minimum income – Rs. 1,20,000 per year 
  • Minimum 6 months in job or 1 year of business
  • 1 year of residence proof at given address

#10. Muthoot Finance Bike Loan Interest

Muthoot Finance offers the lowest bike finance interest rate starting at 0.99% per year. Muthoot finance offers two types of loans.

  • No Income loans – No income proof required to avail of this loan.
  • Income Loans – You get a loan based on the proof of your income.

Muthoot Finance  two wheeler loan interest rate 

Muthoot Finance bike loan interest rate is 0.99%. You can repay the loan in a maximum of 5 years.

Muthoot Finance  bike loan other charges  

  • Processing Fee – 0.50% of the loan amount
  • Documentation Fee – 0.50% of the loan amount
  • Pre-payment closure Fee – 4% of the outstanding amount

Muthoot Finance two wheeler loan eligibility

  • Minimum age 18 years of age up to 65 years age 
  • Minimum income – Rs. 96,000 per year 
  • Minimum 6 months in job or 1 year of business
  • 1 year of residence proof at the given address

#11. IDBI Two Wheeler Loan Interest Rate

IDBI has given bike loan interest rates slab as per individual’s credit score. You pay lesser interest rate if your CIBIL score is high.

IDBI two wheeler loan interest rate 

IDBI bank two-wheeler loan interest rate is 8.40% for credit score above 800 and upto 9.80% for credit score below 740.  Loan repayment tenure is 5 years.

IDBI bank  bike loan other charges  

  • Processing Fee – 0.50% of the loan amount
  • Documentation Fee – As per actual cost
  • Pre-payment closure Fee –  PNB doesn’t charge any prepayment penalty fee.

IDBI bank two wheeler loan eligibility

  • Minimum age 18 years of age up to 65 years age 
  • Minimum income – Rs. 1,20,000 per year 
  • Minimum 6 months in job or 1 year in the business
  • 1 year of residence proof at the given address

#12. BOI Two Wheeler Loan Interest Rate

Similar to IDBI, Bank of India bike loan interest rates are fixed as per cibil score slab. If you have a credit score above 760, then you can get interest rate as low as 7.75%.

BOI two wheeler loan interest rate 

Bank of India two-wheeler loan interest rate is 7.75% if cibil score is above 760 and 8.35% if you have a bad cibil below 675. 

Loan repayment tenure is up to 5 years.

BOI Bank  bike loan other charges  

  • Processing Fee – 1.00% of the loan amount
  • Documentation Fee – 1.00% of the loan amount
  • Pre-payment closure Fee –  BOI doesn’t charge prepayment penalty.

BOI Bank two wheeler loan eligibility

  • Minimum age 21 years of age up to 65 years age 
  • Minimum income – Rs. 1,20,000 per year 
  • Minimum 1 year in the profession
  • 1 year of residence proof at the given address

Also read – Personal loan interest rate in India

Two Wheeler Loan Interest Rate Calculator

Let’s see how to calculate two wheeler loan interest.  Here’s the formula –

E = [P x R x (1+R)^N]/[(1+R)^N-1] 

Where,

E – EMI Amount 

P – Principal Amount

R – Rate of Interest

N – Tenure

For example, You get a loan to buy a new bike worth Rs. 1,00,000 at 12% interest rate for 2 years.

E = [100000×12/100x(1+12)^24]/[(1+12)^24-1]

E = 4707

Means, EMI – 4707.

Now you can calculate the total interest paid.

Total amount payable = 4707 X 24 = 112968

Interest paid = 112968 – 100000 = 12,968.

Two Wheeler Loan Interest Rate Comparison

Bank NameInterest Rate
HDFC Bank11.83% – 26.83%
SBI10.65%  – 16.45%
Bajaj Finance07.85% – 18.00%
ICICI Bank10.00% – 26.00%
IDFC First10.75% – 22.00%
IndusInd Bank12.00% – 29.00%
Axis Bank01.00% – 28.50%
Bank of Baroda08.85% – 14.25%
Punjab National Bank10.70% – 13.70%
Muthoot Finance24.00% – 28.00%
IDBI Bank08.40% – 09.80%
BOI07.75% – 08.35%

Documents Required For Two Wheeler Loan

You have to keep the following documents ready if you need a two-wheeler loan.

  • Identity Proof – Aadhar Card, Passport, PAN Card, Voter ID card, Driving License
  • Proof of Income – The last three salary slips and Form16 for salaried person and ITR for self-employed. Bank will also attach your last 6-month bank statement.
  • Residence Proof – Aadhar Card, Voter ID card, Passport, Telephone Bill, and Electricity Bill, Domicile certificate, Rent Agreement in case of a rental house
  • 3 Passport size photographs

FAQs

#1. What are the main factors that affect bike loan interest rate?

Factors like down payment, loan period, CIBIL report, and your net income. A high income with a high CIBIL score gives you the benefit of cheaper loan interest rates. Because banks find you a potential customer with high chances of repayment.

#2. How can I avoid the rejection of my loan application?

You must assure the bank to repay the loan amount with different proofs like you should not have multiple loans running together. 

Your salary should be under the eligibility criteria of the bank. 

You must have a good credit score because banks check credit history before giving any loan approval.

#3. What should I do if my auto loan application gets rejected?

  • Clear your old debts at earliest.
  • Improve your CIBIL score if you have a low score, and wait for a couple of months at least 6 months). 
  • Make your spouse a co-applicant to boost the combined income, if your spouse is earning.

Also read – Pradhan Mantri Awas Yojana

Conclusion 

I have found BOI and IDBI the best options to get a cheaper two-wheeler loan. Which is your favorite bank for the bike loan, share your experience in the comments.

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