Latest Car News in India

Wednesday, January 25, 2012

By Shilpa Chopra

SBI increases the annual income limit for the car loans

The State Bank of India has increased the annual income limit of Rs.2.5 lakh (i.e. 21, 000 per month) for the car loan customers. Now, the bank will provide the car loans to the customers having annual income of at least 2.5 lakh or more, earlier which used to be one lakh per annum (i.e.8, 300 per month).

The SBI clarified that the increase in the minimum income requirement will take out the bottom level of car-buyers and minimize the risk of dishonest assets. It is a part of the bank’s new strategy that will clear the entire car loan procedure.

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A senior bank official stated that the decent increment of the annual income limit of Rs.2.5 lakh will safer for the both, the bank and the customers purchasing a car from the compact segment. The bottom level car buyers those are shifting from the two-wheelers to the compact cars should be financially good enough to pay-out the minimum monthly instalment (EMI) of Rs.1, 765.

Earlier, SBI had been offering the seven year car loan scheme with the monthly instalment of the Rs. Rs.1, 765, but from last few months some defaults have been came in light concerning to the loan repayments. This new strategy of increasing the annual income limit for car loans proves to be an important decision to manage the faulty assets. This change in income limit will surely affect those middle class people who are looking for Tata Nano.

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