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Best Car Loans in India 2025

Drive your dream car with LoanPao’s low rates from 6.85% p.a. and approvals in 24 hours.

Apply Now

About Car Loans in India 2025

A car loan is a financial product that helps you purchase a vehicle by borrowing funds from banks or NBFCs. In 2025, with India’s auto market growing by 10–12% annually, car loans offer competitive rates from 6.85% p.a., tenures up to 7 years, and financing up to 100% of the on-road price. LoanPao partners with 250+ trusted lenders to provide tailored solutions, ensuring quick approvals and minimal paperwork.

Key Features of Car Loans

  • Loan Amount: Up to 100% of the car’s on-road price, based on eligibility.
  • Interest Rates: Starting at 6.85% p.a. (fixed or floating).
  • Tenure: Up to 7 years for affordable EMIs.
  • Digital Process: Apply online with e-KYC and instant pre-approvals.
  • No Prepayment Penalties: For floating-rate loans, per RBI guidelines.

Whether you’re buying a new or used car, LoanPao’s experts, backed by RBI-compliant lenders, guide you every step of the way. Start your journey today!

Car Loan Interest Rates 2025

Compare rates from top lenders, starting at 6.85% p.a. Rates vary based on credit score, loan amount, and loan type.

Lender Interest Rate (p.a.) Processing Fee
State Bank of India 6.85%–8.25% 0.25%–1%
HDFC Bank 7.10%–9.00% Up to 0.5%
Axis Bank 7.45%–9.50% Up to 1%
ICICI Bank 7.25%–9.75% 0.5%–2%

Loan Comparison Tool

Our Loan Comparison Tool lets you compare rates, tenures, and fees from 250+ lenders in real-time. Enter your loan amount, tenure, and credit score to find the best deal.

Compare Now

Why Choose LoanPao?

LoanPao offers tailored car loans with over 250 trusted lenders, seamless digital applications, and 24/7 support. Our experts, certified by IRDAI, ensure transparency and compliance with RBI guidelines.

Low Rates

Competitive rates starting at 6.85% p.a.

Quick Approvals

Approvals within 24 hours with minimal paperwork.

Trusted Partners

Access 250+ banks and NBFCs.

Eligibility Criteria

Check if you qualify for a LoanPao car loan:

  • Age: 21–65 years
  • Income: ₹20,000+/month (salaried) or ₹2.5 lakh p.a. (self-employed)
  • Credit Score: 700+ for better rates
  • Employment: 1+ years (salaried) or 2+ years (self-employed)
  • Tip: Adding a co-applicant can improve eligibility and rates.
Check Eligibility

Application Process

Apply for your car loan in 5 easy steps:

  1. Submit online application on LoanPao’s platform.
  2. Provide ID, income, and vehicle details.
  3. Get pre-approved offers from lenders.
  4. Complete verification (KYC and vehicle valuation).
  5. Receive funds in 24–48 hours.
Apply Now

EMI Calculator

Use our EMI Calculator to estimate monthly payments and total interest based on loan amount, tenure, and rate.

Calculate EMI

Types of Car Loans

LoanPao offers various car loan options to suit your needs:

  • New Car Loan: Finance up to 100% of the on-road price for new vehicles.
  • Used Car Loan: Affordable rates for pre-owned cars, up to 80% of valuation.
  • Loan Against Car: Use your existing car as collateral for quick funds.
  • Top-Up Loan: Additional funding on an existing car loan.

Market Insights

With India’s auto sales projected to grow by 10–12% in 2025, RBI’s repo rate at 5.50% has lowered car loan rates. Electric vehicle (EV) loans are gaining traction with incentives like lower rates and tax benefits. Read more in our blog.

Testimonials

“LoanPao got me a 6.95% car loan in just 24 hours. Seamless process!”

Ravi Kumar, Bangalore

“Their comparison tool saved me ₹1.5 lakh in interest. Highly recommend!”

Priya Sharma, Chennai

Frequently Asked Questions

Up to 100% of the car’s on-road price, depending on your income, credit score, and lender policies.

Yes, most lenders allow prepayment with minimal or no penalties for floating-rate loans, per RBI guidelines.

Age: 21–65 years, Income: ₹20,000+/month (salaried) or ₹2.5 lakh p.a. (self-employed), Credit Score: 700+.

With LoanPao, approvals can be as fast as 24 hours with complete documentation.

Documents Required

Prepare these documents for a smooth car loan application:

  • Identity Proof: Aadhaar, PAN, Passport, or Voter ID
  • Address Proof: Aadhaar, Utility Bill, or Rental Agreement
  • Income Proof: Salary slips (3 months), ITR (2 years), or Form 16
  • Vehicle Documents: Quotation, RC (for used cars)
  • Bank Statement: Last 6 months

Tips to Get the Best Car Loan

Maximize your car loan benefits with these tips:

  • Check Your Credit Score: A score above 700 ensures lower rates.
  • Compare Lenders: Use LoanPao’s tool to find the best deal.
  • Opt for Shorter Tenure: Reduces total interest paid.
  • Negotiate Fees: Ask lenders to waive or reduce processing fees.
  • Consider EVs: Special schemes for electric vehicles in 2025.