For the majority of Indians, the humble bike is a lifeline. For some, it is indeed an esteemed possession whereas, for others, it is a strapping status symbol. Two-wheelers are most popular in India thanks to various factors. This is evident from the fact that Two-wheelers account for approximately 80 per cent of vehicle sales in India, and within that motorcycles make up more than 60 per cent of the segment. Some of the factors that further led to the rapid rise in sales of two-wheelers include lowest bike loan interest rates, easy repayment terms, quick loan approvals etc. The two-wheeler industry is likely to record a growth of 8-10%, this financial year. During the period from April- October, there is an 11.1 % rise in the sales of the two-wheeler industry. Leading financial institutions are willing to offer loans whose interest rates begin at .99% per annum. There are many factors one should keep in mind while applying for a two wheeler loan.

Eligibility criteria for a two-wheeler loan


The person should be older than 18 and not more than 65 to apply for two wheeler finance. If you are a person in the early or mid-twenties or thirties, you will be offered a lower bike loan interest rate than the one who is going to retire shortly. This will curtail your ability to repay as in some time you will not have any source of regular income.

Nature of employment

If you are a salaried person, you should earn at least Rs. 96,000 per year. If you are in employment with a reputable company, you can avail of a higher amount as a loan. Many financial institutions will be interested in offering a low rate of interest for employees of reputed companies as there is a lesser risk of defaulting.  The employer status is an important element while approving any loan in India.

Rate of interest

The rate of interest for two-wheeler finance starts from 10% for 1 year to 4-year loan schemes. The amount you get depends on your requirements as well as your ability to repay the amount. Before applying to any bank or financial institution, you have to do thorough research to compare the rate of interest to choose the lowest bike loan interest rate and to avoid any extra financial burden. This assessment will help you to check whether you can tighten your belt and pay for the EMI or it would create a hole in your budget. Make an informed decision after going through all the options.

EMI Calculator

It is always advisable to compare the EMIs to choose a loan with the lowest bike loan interest rate. You have to check for the terms of payment of different lenders before you approach a particular lender. Apart from the interest rate, there is certainly another factor you have to be wary of, the exact processing fee one would have to pay for the loan. There can also be other factors that can sometimes be overlooked, which could impact the borrower’s budget. To avoid this issue, a prospective borrower can use any one of the EMI calculators available online. Choosing the best one is up to the person using it, but the prospective borrower should make sure that she has used the calculator to gather an approximate for the loan amount.

Check for discounts and offers

During festive seasons, there are many offers offering you two-wheeler loans at low-interest rates. In such a case, the borrowers can approach the financial institutions that will let them pay a lower amount than during the normal seasons. Keep looking for offers around during the festive seasons. Usually, institutions offer loans at attractive interest rates because most of the Indians shop during the festivals.

With these factors in the mind of any borrower, he/she can make sure that they are well informed during the important decision of taking a bike loan.