Lower interest rates, increasing ownership of used cars, etc. to drive India used car loan market. According to TechSci Research report, “India Used Car Loan Market, By Vehicle Type (Hatchback, SUVs & Sedans), By Financier (Banks, NBFCs (Non-Banking Financial Companies) & OEM), By Percentage of Amount Sanctioned (Up to 25%; 25-50%; 51-75%; Above 75%), By Tenure (Less than 3 Years, 3-5 Years & More than 5 Years), By Region, Competition, Forecast & Opportunities, FY2027F” India used car loan market is projected to grow at a CAGR of over 11% in value terms and to reach around USD16 billion by FY2027F. With lower interest rates, rising ownership of used cars, increasing disposable income, etc. the market has witnessed an increase in demand for used car loans in the country.
The Important Aspects of India Used Car Loan Market
Choosing a used car loan is a wise decision that provides buyers with good value for money. With rising disposable income and urbanization, customers no longer choose to keep a car for several years and always prefer to upgrade to the latest models. Companies such as CarDekho, CARS24, Spinny, OLX Auto(Cars), Droom Credit, and others have launched digital platforms for used car buyers and sellers to provide servicing and warranty facilities, as well as an easy instant, and paperless loan experience so that a potential buyer can simply ask the dealer for loan offers on any pre-inspected car and the dealer can also check the buyer’s eligibility with multiple banking partners on the spot with a few clicks. People can also begin the loan application process in seconds by uploading KYC and other required documents to these platforms.
As a result of the COVID-19 outbreak in the second half of March, FY2020, and the subsequent restrictions imposed as a result of continuous lockdowns and disruptions in India’s travel and transportation networks, there has been an increase in the population’s need for personal vehicles such as used cars. However, the used car market experienced supply constraints because people did not sell their vehicles as they did prior to the pandemic, affecting exchanges and demand for used car loans. The COVID-19 pandemic also had an impact on the country’s per capita income, so drivers and small-scale fleet management companies were looking for more cost-effective investments, such as purchasing used cars as a means of small business. This mode proved to be very cost-effective for many small logistics and transportation business owners, as well as those who experienced losses in their other businesses. Due to financial constraints, these small-scale fleet management companies preferred to purchase used cars through used car loans during the pandemic.
Browse over 33 market data Figures spread through 92 Pages and an in-depth TOC on the ” India Used Car Loan Market ”.
India used car loan market is divided into vehicle type, financier, percentage of amount sanctioned, tenure, region, and by company. Based on the vehicle type, India used car loan market is segmented into Hatchbacks, SUVs, and Sedans. Among these, the hatchback vehicle type has dominated the used car loan market in the country, holding a share of more than 49 percent in the market in FY2021, and will continue to dominate in the forecast period as well. This is due to the benefits it provides, such as riding comfort, safety, budget, and lower noise and vibration when compared to other competitors in the same segment.
On the basis of region, India used car loan market is divided into North South East, and West. Among these, the North region in the country is projected to grow at the fastest pace than any other region. The Northern region, which includes Punjab, Chandigarh, Haryana, Himachal Pradesh, J&K, Delhi, Uttar Pradesh, and Rajasthan, contributed approximately 33-35 percent of total used car sales in India in FY2020, implying that used car loan market players should focus on the North region to achieve maximum growth.
In terms of company, major players operating in India used car loan market
- HDFC Bank Ltd.
- State Bank of India
- ICICI Bank Ltd.
- Shriram Transport Finance Co. Ltd.
- Mahindra & Mahindra Financial Services Limited, and others. In FY2021, HDFC Bank Ltd. Leading players are focusing on expanding their product portfolios to maintain sustainable growth in the market. The companies are also expanding their reach through acquisitions and mergers.
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“Digitalization is the buzzword in India’s used car market, and the industry has shifted its focus to providing potential buyers with a virtual experience. Big Boy Toyz, which sells and buys premium and exotic luxury used cars, has launched a new smartphone app that allows customers to browse a selection of used automobiles, book appointments, make payments, and apply for loans within seconds. This is a significant market development that will contribute to the growth of the country’s used car loan market during the forecast period,” said Mr. Karan Chechi, Research Director with TechSci Research, a research-based global management consulting firm.
““India Used Car Loan Market, By Vehicle Type (Hatchback, SUVs & Sedans), By Financier (Banks, NBFCs (Non-Banking Financial Companies) & OEM), By Percentage of Amount Sanctioned (Up to 25%; 25-50%; 51-75%; Above 75%), By Tenure (Less than 3 Years, 3-5 Years & More than 5 Years), By Region, Competition, Forecast & Opportunities, FY2027F” has evaluated the future growth potential of India used car loan market and provides statistics & information on market size, structure, and future market growth. The report intends to provide cutting-edge market intelligence and help decision-makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities in India used car loan market.
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