Pre-owned car loans to be offered at 9 percent by Syndicate Bank, M&M

Pre-owned car loans will be offered by Mahindra FirstChoice in a tie-up with Syndicate Bank. Mahindra FirstChoice Wheels is a multi-brand pre-owned car company of auto major Mahindra and Mahindra (M&M). The loan will be offered at an ‘industry first’ nine percent.

Shubhabrata Saha, CEO of Mahindra FirstChoice said pre-owned car have been an unorganized sector and pre-owned car loans rule at an interest of 16-17 per cent. Saha told Business Line, "Only 10 percent of the pre-owned market is in the organized sector and this small base allows us to work our way around with this sub-10 percent loan scheme. This is an entirely new ball game".

As the demand for pre-owned car has been projected to be very high thus Mahindra FirstChoice has confidently launched the ultra low-interest loan campaign with Syndicate Bank. In India the ownership ratio of new cars to pre-owned cars at present stands to 1:1. While in the U.S. and other western countries the ratio ranges from 1:2 to 1:2.5. And now India is also heading in this direction. It is believed the very low car ownership for every thousand people and profit from demographic dividends together is responsible to build a huge constrained demand in the market.