Top Auto Finance Companies in IndiaIndian auto market has more than 35 financers that offer auto financing solutions to the intended car buyers. Being one of the fastest growing automobile markets in the world, the Indian automobile market has got so much of potential and hence a number of auto finance companies have come up to tap the booming market. It can be added here that the passenger vehicle market constitutes almost 80% of automobile sales. In 2008, the stock passenger car was about 11 per 1,000 people. The production of passenger vehicle is further expected to go up at a CAGR of about 10% from 2009-10 to 2012-13. So, sensing this market potential, many financial companies in India have given special attention on auto financing. During the 2000s, the auto finance in India was dominated by private banks, when Citibank was the market leader. But its market share dropped from 27 per cent during 90s to less than 8 percent during early 2000. ICICI Bank became the new leader with almost 29.2 per cent market share during 2003-04. The journey continued till 2008 when HDFC bank took the lead. However, the current trend shows that the PSU banks like SBI, PNB, Bank of Baroda, Bank of India, Canara Bank, Syndicate Bank and Union Bank etc. are leaving behind their private sector counterparts in the `22,000 crore passenger car and 2-wheeler loan market. The reason behind this is the fact that, private banks have been compelled to reduce their exposure to the sector owing to increased delinquencies. List of Top Auto Finance Companies in India Following is the list of top auto finance companies in India: State Bank of India State Bank of India (SBI) is one of the leaders in the auto finance segments in India. Recently it has slashed down its rate of interest for the new cars, which, in turn, has attracted a number of customers. Its long repayment option and extensive network of more than 12,150 branches have also made it quite popular among the customers. Recently SBI has inked a deal with General Motors for car finance. In 2008-09, SBI registered a net profit of ` 9,121 crore, which was 35.55% bigger than the last financial year's profit of ` 6,729 crore. ICICI Bank ICICI Bank was the market leader in auto finance in India till 2008. Though currently not on the top, it still remains amongst the top 10 auto finance companies in India. However, to regain its lost reign, ICICI Bank is putting car loans on fast track. In the current financial year, ICICI Bank has doubled auto loan disbursement amount to more than 1,500 crore, comparing to the last financial year (ended March 2009). ICICI Bank registered a net income of ` 35,769.5 million in the last financial year (ended March 31, 2009). 444. In 2008-09. business loans and many more. For the year ended March 31. status and taste. Unique features and low interest rates are USPs of Bank of Baroda car loans. In the financially year 2008-09. BAFL registered a profit (after taxation) of `339. comparing to ` 1.173 crore. In order to stay in the race of dominating Indian auto finance market. Bank of Baroda Bank of Baroda offers specially-designed car loans for the customers so that it meets their demands.2 billion.435.590. HDFC Bank HDFC Bank is a market leader in auto finance in India. Punjab National Bank Punjab National Bank. Loans are also offered for purchase of vehicles of . 2009. Bank of Baroda also offers a unique facility for installation of CNG/LPG Gas-kit in the cars. Citibank Once a market leader in auto financing in India.227. comparing to previous year's profit of ` 201.804 crore. a renowned leader in the field of auto finance market in India. One of the leading players in the market.1 million. Offering a diverse array of financial products to its clients ranging from two wheeler loans to other loans like consumer durable loans. HDFC Bank also cut down the rate of interest for its car loan. Citibank registered a net profit (after tax) of ` 2.18 in the previous financial year. Citibank offers a range of auto financing options for the customers. offers auto loan for new as well as old vehicles of not older than 3 years. which was 20% higher than its previous year's profit of ` 1.93 lacs. Citibank offers automobile financing to its clients through its extensive dealership network across the country. Loans are offered for new as well as used cars.20 crore. Bank of Baroda registered a net profit of 2. Bajaj Auto Finance Limited (BAFL) Bajaj Auto Finance Ltd is one of the leading auto finance companies in India. comparing to the net profit of ` 1. HDFC Bank registered a profit of ` 2. BAFL also offers free personal accident insurance to its clients. It has an extensive network of 50 branch offices and more than 6000 consumer durable dealerships. In the financial year 2008-09.52 crore in the previous financial year. hasslefree documentation and quick processing. UBI registered a net profit of ` 18470.aspx http://www. Founded in 1998. Canara Bank further reduced its auto loan rates to woo customers. KMPL registered a net profit (after tax) of ` 1. It also has an extensive network of more than 400 branches across the nation. Kotak Mahindra Prime Limited (KMPL) Kotak Car Finance has crafted a niche in the Indian auto finance market through its flexible schemes.14 lakhs in 2008-09. From August 2009.foreign/indigenous makes.bankrate.88 lacs in the year ended March 31. In 2008-09. which saw a 32.4% rise from previous year's net profit of ` 1565 crore.96 lakhs. In 2008-09. In September 2009.scribd. >> More About India Finance http://www. It offers car loan for new cars as well as for used cars. this company extends finance in all models of cars. PNB registered a net profit of ` 3. Customers can choose from a range of vehicle and finance packages offered by the company. Canara Bank registered a net profit of `2072 crore in 2008-09. PNB tied up with Mahindra and Mahindra for financing their vehicles across the nation.090. United Bank of India United Bank of India is one of the leading auto finance companies in India offering range of car financing options to the customers.com/doc/45743351/Project-on-Hdfc-Car-Loan .570 million.com/auto. 2009. KMPL finances new as well as used cars. Sundaram finance registered a consolidated net profit of `15073. Sundaram Auto Finance Sundaram Auto Finance is one of the market leaders in the auto finance market in India. Canara Bank Canara Bank offers attractive interest in the auto loans for its customers. WagonR. The PSU banks are extending loans mainly in the range up to Rs 3 lakh for small cars like Alto. Arvind Saxena agreed with the view of Pareek and said. the PSU banks have vastly improved quality of their services which today are no less than private sector banks.5%. "This used to be the opposite if you look at market share position in fiscal 2006-07." said Pareek. On the other hand the PSU banks have responded to the RBI's signal to lower interest rates and thereby captured a large share in the finance portfolio of most auto makers in the industry.scribd. their share in our financed car sales has surpassed that of private sector banks.000 crore every month against the private banks that comprise a total auto lending of nearly Rs 800 crore.http://www. Canara Bank." said Arora. At the same time these banks are also catering two-wheelers loans. Amongst the public that have been aggressively disbursing auto loans. the largest lender SBI takes a lead. Mayank Pareek said that recently the PSU banks are actively taking part in auto financing. VP (sales and marketing) of GM India." he added." said Pareek and Arora. "It is growing. The others following the leader are Bank of India. "PSU banks have been very active in the market and off late.com/doc/45743351/Project-on-Hdfc-Car-Loan CURRENT MARKET SCENARIO PSU banks dominate the auto loan market By Vaibhav Aggarwal Feb 13. Maruti Suzuki. These banks are jointly lending around Rs 1. 2009 The Public sector banks in the industry have been active in the car financing and regaining their space in the auto loan market. "On an average. Bank of Baroda. Santo and Indica. and that too rapidly. PSU banks hold 70% share in the financed car sales of Maruti and the remaining 30% are financed by private banks. .com/deleted/54316073 http://www." Ankush Arora.scribd. Syndicate Bank and Union Bank of India. Punjab National Bank. the interest rates of PSU banks are lower by 1-1. Hyundai India's senior VP (marketing and sales). They seem to overtaken their private peers that have walked out from the auto lending due to the increased delinquencies. "Against the perception that they are slow in processing applications. also told that the PSU banks have been more competitive in the market and their share in the financed car sales of GM have increased to 45%. The main reason for an increase in the auto loan portfolio of the PSU banks is the falling auto loan rates relative to the interest rates charged by the private banks. executive officer (marketing and sales). 5%. Their products are customized with novel service offerings and subsidies.5% to 13. A company official said. PSU banks dominate the auto loan market By Vaibhav Aggarwal Feb 13. To benefit from its growing popularity. . 2009 Moreover the private banks have been reluctant in their lending as a fear of increasing defaults. funding a car has now become very trouble-free and effortless task. flexible and modified financing alternative for the purchase of new cars are accessible throughout the nation." A year ago the auto loan market was dominated by the private banks with a combined market share of 75-80%.Besides the wide reach of the PSU banks is also a major factor behind the success of these banks. This has given an edge to the public banks that are extending auto loans in the range of 12. "We have decreased our exposure in the market and now our total loan size is now reduced to around Rs 500 crore annually. ICICI's Head vehicle finance N R Narayanan said. The best car finance scheme is the one that provides the lowest rate of interest and extended loan tenure. We have a large portfolio of the auto vehicles already financed in the past and are focusing on managing it. Also. all banks are endorsing their products competitively in the market. "Much of the growth in car sales is coming from smaller regions of the country and here the PSU banks enjoy a good penetration." ICICI Bank that was the market leader in auto loans space till early 2008 has drastically reduced lending. A comprehensive. Owing to the presence of various conglomerates and private sector banks in India." said Pareek. they have good profiling of customers who may be associated with the banks for years. "Private sector banks have been going slow and are not very eager to offer car loans. 349 7.50% of the entire finance amount Rs 134 to Rs 168 0.394 Rs.0-13. rather how much is entirely forfeited by you in the total loan term should be taken into consideration.15 7.15 7.15 5.5 National Bank Canara Bank 12 .5 10.790 7.However. eligible after 30 months 4% on primary sum prepaid NA NIL 1% on primary sum prepaid 2% on primary sum prepaid NIL 7.0 12.609 Allahabad Bank 10 HDFC Bank Tata Capital 18 12 .1% of the entire 7.5 11.537 8.0 7.75% of primary sum outstanding 2% of primary sum NIL outstanding Rs 1600 to Rs 5% of primary sum 3000 outstanding 0.50% of the entire finance amount Rs 500 Syndicate Bank 10 United Bank of 12 . banks offer loan up to 3 times of his yearly income.3% of the entire 7.754 DNA finance amount Car Finance EMI Calculation: .681 . the best deal should not be estimated by solely considering EMI amounts.681 7.754 finance amount 7.827 7.19 7.5 .827 7.900 7.681 Rs 4000 NIL 7.0 10.25 10.15 Overseas Bank SBI Oriental Bank of Commerce Kotak Bank 15 10 12 .681 7. Characteristics of Car Finance Banks reimburse upto 90% of the rate of the new car and 85% of the rate of the used car. banks offer loan up to 6 times of his yearly income. Car Finance offered by various Banks in India: Name of the Bank ICICI Bank IDBI Bank Reliance Consumer Finance ABN Amro Eligibility in terms of yearly income (Rs in Lakhs) 12 – 15 12 – 15 12 – 15 12 – 15 Rate of Interest 9.5-11.0 10.0 11.5% of the entire 5% of primary sum finance amount outstanding Punjab 12.0 EMI in Processing Rs charges Prepayment costs 5% on primary sum prepaid DNA 1% on primary sum prepaid.5 11.5-11. For a self employed person.5 15.15 India Indian 12 . Some banks even provide 7 years of refund term For a salaried individual.75 10.048 5000 8.2500 9. Normally public sector banks provide lower interest rates compared to the non-banking funding firms The interest rate in Car finance is estimated on a monthly basis The banks provide refund term of 12 to 60 months.5 10.754 0.0 11.466 .9.Rs 2500 to Rs 8.717 DNA NIL NIL 0. 017 13.228 6.349 7.705 13.637 13.EMI to be Name of the paid in 1st Bank year 26.549 Oriental Bank 26.982 14.263 13.857 9.514 Canara Bank 26.827 7.077 Syndicate 26.540 10.751 9.540 10.108 9.751 9.598 6.448 6.672 5.680 9.448 6.826 6.514 Allahabad 26.751 9.228 6.705 14.715 9.058 5.913 13.751 9.822 9.710 4.445 Tata Capital 26.913 13.537 8.585 Overseas Bank SBI 26.410 of Commerce 26.374 6.514 EMI to be paid in 2nd year 13.822 9.754 EMI to be paid in 5th year 6.598 6.520 5.982 13.048 7.754 7.216 5.681 7.843 13.710 5.913 13.137 - .097 5.400 9.787 5.448 6.445 Kotak Bank 26.717 7.546 13.540 9.466 8.523 EMI to be EMI to be paid in paid in 6th year 7th year 5.634 5.609 7.795 IDBI Bank 26.942 5.681 7.822 EMI to be paid in 4th year 7.878 13.235 Bank United Bank of 26.787 5.790 7.681 7.058 5.235 Finance ABN Amro 27.634 5.470 9.523 6.523 6.375 Punjab 26.822 9.913 13.445 Bank HDFC Bank 26.166 Reliance Consumer 26.681 7.137 6.982 13.705 14.827 7.893 9.052 14.485 6.445 National Bank 26.448 6.982 EMI to be paid in 3rd year 9.466 7.560 6.754 7.394 7.337 7.514 India Indian 26.235 ICICI Bank 26.155 6.408 5. f f° . @.D-@. 0/- 57.07 2.3 $3/..70843 574..709.990!$&-..3/411.88:75.709 '..3/ 9070-.700.384/ 8.03. %080-.99447.0/8-:783.03990!$& -.07.59:70/.880/9.7093..990.90870.3. 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