The adoption of electric vehicles (EVs) is gaining momentum in India, driven by the focus on sustainability and eco-friendly living. Financial institutions are supporting this trend by offering special car loans for EVs, which come with lower interest rates compared to traditional car loans. According to HDFC Bank, an EV car loan functions similarly to a traditional car loan, but with the added benefits of government subsidies, reduced registration fees, and tax exemptions.
Several Indian banks are offering competitive interest rates for EV loans, with rates starting from 8.15% for electric vehicles and 8.35% for non-electric ones. For instance, Indian Overseas Bank offers interest rates starting from 8.15% for EVs, while Karnataka Bank has the highest rates among listed banks at 9.32% for EVs. State Bank of India, HDFC Bank, Punjab and Sind Bank, Canara Bank, Indian Bank, Union Bank, and Central Bank are also offering attractive interest rates for EV loans.
The benefits of EV car loans are not limited to lower interest rates. The Indian government is also offering various incentives, such as purchase incentives, coupons, interest subventions, road tax exemptions, and registration fee exemptions. According to the NITI Aayog website, these incentives include a direct discount on the cost of the electric vehicle, amount reimbursement, and interest subventions while availing a loan. Additionally, there are scrapping incentives for deregistering old petrol and diesel vehicles.
Overall, the shift towards electric vehicles is gaining traction in India, driven by the combination of government incentives, competitive interest rates, and the growing awareness of the need for sustainable and eco-friendly transportation. With more banks offering attractive interest rates and incentives, it is likely that the adoption of EVs will continue to accelerate in the coming years. As the Indian government continues to promote eco-friendly transportation, it is expected that more financial institutions will offer special car loans for EVs, making it easier and more affordable for consumers to switch to electric vehicles.