More people buying vehicles in cashPaying in cash is the new mantra for an increasing number of car, two-wheeler and commercial vehicle buyers.
14 Aug 2008
Paying in cash is the new mantra for an increasing number of car, two-wheeler and commercial vehicle buyers.
As reported by Business Standard, cash sales of cars and commercial vehicles of ICICI Bank and HDFC Bank have doubled to 30 per cent of the total sales compared to that of last year. In the case of two-wheeler buyers, more than 30 per cent are paying in cash.
Automobile loans are offered at a fixed interest rate and the lending rates have shot up by over 300 basis points in two years. The borrowers are also opting for an increase in the tenure of their loans from 4 years to 5 years to beat the impact of inflation.
HDFC Bank has reduced the dealer commissions on cars from 5 per cent to 2-3 per cent, to pass on the benefit to customers. ICICI Bank is set to introduce a floating rate for auto loans from next week.