Two-wheeler Interest rates bank wise
| Bank | Rate of Interest applicable on Two wheeler loans | processing fee on Loan Amount |
Flat or Diminishing |
| SBI | (Superbike 12.05% p.a.) (normal 17.65% p.a.) | 1.25% or 250-500 | monthly reducing balance |
| PNB | 10.2% | ||
| HDFC | (Superbike 9.65% to 15%) (normal 14.03% to 27.53%) | 3% (ex: 1 lakhs 3,000) | monthly reducing balance |
| ICICI | NA | ||
| Syndicate Bank | MCLR + 2% p.a. | ||
| Corporation Bank | 13.05% | ||
| Bajaj Finserv | 27% to 30% | ||
| Bajaja Auto finance | NA if (12% equal to 21% normal rate) | 3-5%* | Flat rate |
| Vijaya Bank | 11.65% (floating rate >> changes upon inflation rates) |
Before applying with any bank or finance company be sure to calculate and identify whether it flat rate reduced balance rate.
FIxed (no change) vs floating interest rates (changes according to market)
getting loan approval from banks not so easy but other financial institutions charge aggressive rates.
Bike / Two Wheeler Loan EMI calculator
NOTE: below calculator based on the redcuing monthly balance
flat interest vs reducing interest
Note: Be sure to check Intrest rates flat vs diminishing
Ex: you take a loan on
My case Bajaja Auto finance KTM RC 390 2016 Model
Loan is taken: not mentioned after approval i realized: 1,93,000
Processing fee: 10,000
down payment 60,000 or 64k (1,93,000+60K=2.53 but 10K for /gambling or processing fee I guess)
Vehicle cost: 2,42,907
Interest rate: 11.75%Flat (equal to 21% normal)
Loan Tenure: 36 Months or 3 years EMI: 7251 monthly.
7251*36= 261036 (261(total EMI + my downpayment 60k) 3,21036.
Total Principal: 193000
Interest:68036
Total Installment: 261036 (+ my downpayment)
How’s the Interest calculated its Flat?
Ex: you have taken 12,00 for the 1-year loan at 10% interest rate.
1200/12=100 but you need to pay interest as 10%
10% of 100 = 110*12=1320
Ex: Loan Amount: 1,00,000
interest rate 12%
1 year: 12,000 2nd year 12,000 + 12,000 =(24,000) 3rd year 12k*3=36,000)
193000*11.75/100=22,677.5 or 22,678
| Loan Term | Loan Amount | Flat Interest Rate | EMI | Total Interest | Total Repayment |
| 1 Years | 193000 | 11.75% | 17,973 | 22,678 | 215,678 |
| 2 | 193000 | 11.75% | 9,931 | 45,355 | 238,355 |
| 3 | 193000 | 11.75% | 7,251 | 68,033 | 261,033 |
Diminishing Interest rate
just like car loans but car loan providers offers low-interest rates but uses a flat rate to overcome diminishing interest rates.
for a flat interest rate of 10.00% means around 17.5% normal (reducing balance/diminishing) interest rate.
| Loan Term | Loan Amount | diminishing Interest Rate | EMI | Total Interest | Total Repayment |
| 1 Years | 193000 | 11.75% | 17,126 | 12,504 | 2,05,503 |
| 2 | 193000 | 11.75% | 9,063 | 24,504 | 2,17,504 |
| 3 | 193000 | 11.75% | 6,388 | 36,945 | 2,29,944 |
261033-229944=31089 (I paid extra 50% amount)
11.75% flat interest rate equals to 21% diminishing the interest rate
- Monthly EMI Rs. 7,272
Total Interest Payable: Rs. 68,767 - Term: 36 Months or 3 years.
- Interest rate: 21% (not flat its normal)
- loan amount: 1,93,000
| amount | interest rate | term year | Flat interest amount | Flat total payment | normal interest amount | Normal total payment |
| 1 lakh | 12% ( | 1 | 12,000 | 1,12,000 | 6,619 | 1,6,619 |
| 1 lakh | 12% | 2 | 24,000 | 1,24,000 | 12,976 | 1,12,976 |
| 1 lakh | 12% | 3 | 36,000 | 1.36,000 | 19,572 | 1,19,572 |
| 1 lakhs | 21% | 1 | 21,000 | 12,313 |
Difference
6619/12000*100=55%
12976/24000*100=54.06%
19572/36000*100=54.4%
12313/21000*100=58%
You need to pay 50% extra interest rate every year for flat. (12% flat = 21% normal interest rate) almost double.
Be care boys when you are taking a loan.
