State Bank of India offering loan at discounted rate for electric vehicle buyers

In a bid to boost volumes for the struggling electric vehicles segment, State Bank of India Monday launched a discounted loan for buyers of such vehicles pricing 20 basis points lower than its existing auto loans. Of the 3.6 million (FY19) car industry, EVs constitute around 1,000 units per annum, according to industry data, and together with two-wheelers the industry notches up over 54,000 units annually despite the many policy pushes to promote this segment of transport. But the two-wheeler segment in a 20 million business annually now.

Many in the industry blame the lack of policy clarity for the poor-show by this segment as the government has only been setting deadlines without thinking about the basic infrastructure and the billions of dollars of investments needed for that.

In fiscal 2018, electric scooters volume more than doubled to 54,800 from a year ago while electric car fell to 1,200 from 2,000 over the same period, according to data from the Society of Manufacturers of Electric Vehicles.

“We believe SBI green car loan (electric vehicle) scheme would act as a change agent in the auto loan segment and encourage customers to switch to electric vehicles which can improve overall air quality and lower carbon emissions,” managing director, retail and digital banking, PK Gupta said.

The scheme that comes with the longest repayment period of up to eight years is a strategic inclusion to the bank’s auto loan segment offered with zero processing fee for the first six months of the launch.