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Power Your Drive: A Guide to Electric Vehicle Loans

December 26, 2023 • 651 views

Technological innovation and increasing climate awareness among citizens has resulted in the increasing demand for electric vehicles or EVs worldwide. In India, to encourage people to switch to using EV from cars that run on traditional fuels, the government offers special tax benefits under Section 80EEB of the Indian Income Tax Act. Moreover, the availability of car financing has made buying electric vehicles easier than ever before. 

In this article, we discuss electric vehicle loans, their eligibility criteria, how to apply, and more. Read on!

What are Electric Vehicle Loans?

Electric vehicle loan is a form of credit that you can avail of to purchase an electric vehicle model of your choice without liquidating your savings. No matter, if you are a salaried employee and self-employed professional, you can get the loan, provided you meet the eligibility criteria and submit the necessary documents. Today, you can easily get an electric vehicle loan at competitive interest rate.

How do Electric Vehicle Loans Work?

The electric vehicle loan is very similar to the traditional car loan. You can get the loan at competitive interest rates and with extended repayment tenure. It allows you to pay off the loan in EMIs over a predetermined tenure set by the financial institutions. You do not have to pledge any collateral to avail this credit option.

Types of Electric Vehicle Loan Providers

There are various types of electric vehicle loans depending on the lender you choose. NBFCs (non-banking financial companies). offer this credit option under the name of Green Car Loans. While multiple NFBCs are in line to enter the EV financing space, many of them, such as the Poonawalla Fincorp, have already collaborated with vehicle manufacturers to extend electric vehicle loans at competitive interest rates.

For example, you can finance your used electric vehicle with a value of up to 75 lakhs at a compelling interest rate of 11% per annum with Poonawalla Fincorp. The prompt approval for your loan with instant processing can make the entire procedure hassle-free.

Eligibility Criteria for Electric Vehicle Loans

The eligibility criteria for an electric vehicle loan may vary based on whether you are a salaried employee or a self-employed individual.

Eligibility for Salaried Employees

  • Age – You must be aged between 24 and 60.
  • Work Experience – You must have total work experience of at least 12 months and you must be employed for a minimum of three months in the current organisation.
  • Citizenship – You must be an Indian citizen.
  • Credit score – You must have a credit score of at least 750.

Eligibility for Self-Employed Individuals

  • Age – You must be aged between 24 and 60.
  • Business Vintage – You must be running your business for at least 24 months.
  • Citizenship – You must be an Indian citizen.
  • Credit score – You must have a credit score of at least 750.

How to Find the Best Electric Vehicle Loan?

You can avail of an electric vehicle loan by considering the following parameters:

Compare Interest Rates and Terms

One of the important aspects you must consider is the interest rate levied by the lender. It should be competitive so that your EMI is affordable.

In addition, it is crucial to go through the terms and conditions of the electric vehicle loan. It will help you understand the additional charges, repayment options, etc., and allow you to make an informed decision.

Maintain a Good Credit Score

Make sure to clear prior debts and avoid making multiple loan applications. Pay your dues on time as it contributes to building a good credit score, showcasing your reliability and responsible financial habits.

Know the Eligibility Criteria

Adhere to the eligibility criteria and submit the necessary documents. For example, if an NBFC is offering an EV loan only to salaried employees and you are self-employed, you might not you’re your loan approval. Any discrepancies in the documentation will lead to the rejection of the loan application.

How to Manage Your Electric Vehicle Loan?

Here’s how you can manage your EV loan well:

Create a Budget for Your Electric Vehicle Loan

Before applying for a loan, you must know the amount you need to borrow. Otherwise, you can be in a monetary burden during the repayment tenure. Creating a budget will help you make a substantial down payment and ensure a seamless repayment process.

Repay Your Electric Vehicle Loan Early

If you have surplus funds, use it to repay the loan as soon as possible. This will help become debt-free sooner and you can focus on other financial goals.

Also Read - Advantages of Electric Vehicles (EVs) in India

To Conclude

With the proper financial backup, you can purchase electric vehicles and head towards a sustainable future. If you want to apply for a secure electric vehicle loan, contact Poonawalla Fincorp. Take advantage of a simple application process with minimal paperwork. Additionally, the credit option is available at lower interest rates.

Disclaimer

We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Pre-Owned Car Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

Our team of expert writers and editors are passionate about providing authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

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