The trend of buying a second hand car as a first car is increasing among people. Image Credit source: Pixabay
Now the craze of buying a second hand car is also being seen among the people. Especially youngsters are preferring a used car as their first car. Therefore, now many non-banking finance companies (NBFCs) have started giving loans for these cars as well. Let’s know about it…
Let us tell you, one of the major reasons for introducing a loan product for second hand cars is the increasing sales of electric vehicles. Industry experts believe that due to people moving to electric cars, people will sell their old petrol and diesel cars, so now loan facility will be needed for them too.
Who gives loan on second hand car?
Many NBFCs have introduced loan products for second hand cars. These include Mahindra Finance, Shriram Finance, Poonawalla Fincorp and Cholamandalam Finance. Apart from this, very soon other companies can also enter this segment.
Earlier, the second hand car loan market was 20 percent, but in the last one year it has increased to 35 percent. However, the interest rate for a second hand car loan is higher than that for a new car loan.
Interest is so high on second hand car loan
The amount of interest you have to pay on taking a loan for a new car, this interest rate can be higher by 2.5 percent to 4 percent on the second hand car loan of the same category. In the financial year 2022-23, the second hand car business within the country has increased by 7 percent on an annual basis.
In the financial year 2022-23, where about 45 lakh second hand cars were sold. By the financial year 2025-26, this sale is expected to increase to 70 lakh cars. The second hand car market is growing at the rate of 12 to 14 percent every year. At the same time, in the next 5 years, 35 percent of the second hand car market in the country can be organized.
