Two-Wheeler Loan Interest Rates 2026
Compare bike and scooter loan rates of 8 banks, see what the dealer’s “flat rate” really costs, check how much down payment you need, and understand EV offers, superbike loans, hypothecation and closure before you sign at the showroom.
RBI repo rate 5.25% · Lender rates checked 27 September 2026Two-Wheeler Loan interest rates — 8 lenders compared
Published starting and maximum rates for each lender. The RBI repo rate is 5.25% after cuts totalling 1.25 percentage points in 2025, so floating-rate loans linked to the repo rate are cheaper than a year ago. The rate you are offered depends on your credit score, income, employer and loan details.
| Lender | Interest rate (p.a.) | Processing fee | Tenure | EMI per ₹1 lakh* | Rates as of |
|---|---|---|---|---|---|
| Indian Bank Two-Wheeler LoanPublic sector bank | 8.90% – 10.40% | About 1% of loan + GST (aggregator) | Up to 4 years (48 months) | ₹3,175 | 10 Sep 2026 |
| Bandhan Bank Two-Wheeler LoanPrivate sector bank | 9.47% – 22.08% | Up to 5% of loan + GST (aggregator — check with bank) | Up to 4 years (48 months) | ₹3,202 | Sep 2026 (aggregator) |
| PNB Two-Wheeler Loan (PNB Saarthi)Public sector bank | 10.00% onwards | 0.50% of loan (min ₹500, max ₹1,000) + GST | Up to 5 years (60 EMIs) | ₹3,227 | Sep 2026 |
| Axis Bank Two-Wheeler LoanPrivate sector bank | 11.00% – 28.00% | Up to 2.5% of loan + GST | 12 – 48 months; super bikes up to 60 months | ₹3,274 | Sep 2026 (bank + aggregator) |
| SBI Two-Wheeler LoanPublic sector bank | 11.70% – 15.70% | 3% of loan + GST (50% waiver for salary-package customers) | Up to 5 years (60 months) | ₹3,307 | 16 Sep 2026 |
| Federal Bank Two-Wheeler LoanPrivate sector bank | 12.60% – 16.00% | Not published — ask for the KFS | Up to 4 years (48 months) | ₹3,350 | 19 Sep 2026 |
| Bank of Baroda Two-Wheeler LoanPublic sector bank | 13.60% – 13.65% | 2% of loan (min ₹250) + GST | Up to 5 years (60 months) | ₹3,398 | Sep 2026 |
| HDFC Bank Two-Wheeler LoanPrivate sector bank | 14.50% onwards | Up to 2.5% of loan + GST; documentation charges extra (aggregators cite up to 2.25%) | 12 – 48 months | ₹3,442 | Sep 2026 (aggregator) |
* At the lowest rate for 3 years. Starting rates go to borrowers with strong credit scores and income; your rate depends on your profile. Sources and dates on each lender page — confirm with the lender before applying.
EMI calculator
More: EMI calculator · Eligibility calculator · Affordability calculator · Prepayment calculator
How the interest rate changes your EMI
| Rate | EMI | Total interest | Extra vs lowest rate |
|---|---|---|---|
| 9.00% | ₹3,180 | ₹14,479 | ₹0 |
| 11.00% | ₹3,274 | ₹17,859 | ₹3,380 |
| 13.00% | ₹3,369 | ₹21,298 | ₹6,819 |
| 15.00% | ₹3,467 | ₹24,795 | ₹10,316 |
| 18.00% | ₹3,615 | ₹30,149 | ₹15,670 |
₹1,00,000 for 3 years.
Flat rate vs reducing rate
Dealers and some NBFCs quote a flat rate: interest is worked out on the full loan for the full tenure, even though you repay part of it every month. Banks quote a reducing-balance rate. The table converts flat rates to their true reducing-balance equivalent for ₹1 lakh over 3 years.
| Quoted flat rate | EMI | Total interest | Equivalent reducing rate |
|---|---|---|---|
| 5.00% flat | ₹3,194 | ₹15,000 | 9.31% |
| 6.00% flat | ₹3,278 | ₹18,000 | 11.08% |
| 7.00% flat | ₹3,361 | ₹21,000 | 12.83% |
| 8.00% flat | ₹3,444 | ₹24,000 | 14.55% |
| 9.00% flat | ₹3,528 | ₹27,000 | 16.24% |
| 10.00% flat | ₹3,611 | ₹30,000 | 17.92% |
Rule of thumb: the reducing equivalent is roughly 1.8 – 1.9 times the flat rate for 2–3 year loans. The Key Facts Statement must show the APR, which includes this effect plus fees.
How the down payment changes your loan
| Down payment | Loan | EMI | Total interest |
|---|---|---|---|
| 0% (₹0) | ₹1,20,000 | ₹3,929 | ₹21,431 |
| 10% (₹12,000) | ₹1,08,000 | ₹3,536 | ₹19,288 |
| 15% (₹18,000) | ₹1,02,000 | ₹3,339 | ₹18,217 |
| 20% (₹24,000) | ₹96,000 | ₹3,143 | ₹17,145 |
| 30% (₹36,000) | ₹84,000 | ₹2,750 | ₹15,002 |
On-road price ₹1,20,000, 11.00% for 3 years. A 0% down payment (100% funding) is usually offered only to strong profiles or at a higher rate — which would make the EMI higher than shown.
Electric two-wheeler loan offers
| Lender / benefit | What you get |
|---|---|
| SBI | 0.50% rate concession on electric two-wheelers (e.g. 11.70% → 11.20%) |
| Bank of Baroda | bob Green Wheel — dedicated loan scheme for electric two-wheelers |
| PNB, Indian Bank and others | EVs financed under regular two-wheeler schemes — ask about any green concession |
| GST | 5% on electric vehicles, against 18% on petrol two-wheelers up to 350 cc |
| PM E-DRIVE scheme | Demand incentive on eligible e-two-wheelers bought from 1 Oct 2024; the per-kWh incentive was cut in FY 2025-26 — check the current status and amount on the official portal before you buy |
| State EV policies | Many states waive or cut road tax and registration fees on EVs — check your state’s policy |
The purchase incentive is usually passed on by the dealer as a lower price, which also reduces the loan you need.
Bank vs dealer / NBFC financing
| Point | Bank loan | Dealer / NBFC finance |
|---|---|---|
| Rate quoted | Reducing-balance rate (≈8.90% – 16% at banks we track) | Often a flat rate — looks low but the true (reducing) rate is nearly double |
| Speed | Instant for pre-approved customers; else 1–3 days | Often same-day approval at the showroom |
| Funding | 70% – 90% of on-road price at most banks | Up to 100% in some schemes, usually with higher rate or fees |
| Credit profile | Prefers good score and documented income | More willing to lend to new-to-credit or informal-income buyers |
| Charges | Processing fee 0.5% – 3% + GST | Processing/documentation fees, sometimes advance EMIs |
| Prepayment | Nil on floating-rate loans to individuals | Fixed-rate loans often carry a foreclosure charge (e.g. 5%) |
| Rules | Both must give a Key Facts Statement with APR and follow RBI fair-practice rules |
Total cost example
| Item | Amount |
|---|---|
| On-road price (ex-showroom + registration + insurance) | ₹1,20,000 |
| Down payment | ₹20,000 |
| Loan | ₹1,00,000 |
| EMI (11.00%, 36 months) | ₹3,274 |
| Total interest | ₹17,859 |
| Processing fee 1% + 18% GST | ₹1,180 |
| Total paid (down payment + EMIs + fee) | ₹1,39,039 |
| Extra over on-road price | ₹19,039 |
| Effective cost (APR) including fee | 11.82% |
Excludes own-damage insurance renewals, fuel or charging, servicing and tyres. The fee raises the effective rate because you pay it upfront but repay the full loan.
Lenders compared on funding
| Lender | Funding (share of price) | Loan amount | Tenure |
|---|---|---|---|
| Indian Bank Two-Wheeler Loan | 70% – 75% of price (25% – 30% margin) | Up to ₹10 lakh | Up to 4 years (48 months) |
| Bandhan Bank Two-Wheeler Loan | Up to 95% of on-road price (typically 90%) | Up to ₹5 lakh | Up to 4 years (48 months) |
| PNB Two-Wheeler Loan (PNB Saarthi) | 90% of on-road price for salaried with salary via PNB/check-off; 75% for business concerns | Up to ₹10 lakh | Up to 5 years (60 EMIs) |
| Axis Bank Two-Wheeler Loan | — | As per model and profile | 12 – 48 months; super bikes up to 60 months |
| SBI Two-Wheeler Loan | Up to 85% of on-road price | ₹50,000 – ₹3 lakh (regular two-wheeler) | Up to 5 years (60 months) |
| Federal Bank Two-Wheeler Loan | On ex-showroom price (not on-road) | Based on ex-showroom price | Up to 4 years (48 months) |
| Bank of Baroda Two-Wheeler Loan | 90% of price for loans up to ₹3 lakh; 85% above ₹3 lakh | Up to ₹10 lakh | Up to 5 years (60 months) |
| HDFC Bank Two-Wheeler Loan | Up to 100% of vehicle price (select customers/models) | Up to 100% of vehicle price for eligible customers and models | 12 – 48 months |
Two-Wheeler Loan eligibility
- Indian resident aged 18/21 or above; most lenders want the loan to end before 60–65 years of age
- Salaried, pensioner or self-employed with regular income — commonly at least ₹10,000 a month
- Credit score of about 700+ for the best rates; new-to-credit borrowers may need a larger down payment
- Existing EMIs plus the new EMI typically within 50% – 60% of take-home pay
- A valid driving licence is often asked for at the time of disbursal/registration
Documents required
- Photo ID and address proof (Aadhaar, passport, voter ID, driving licence)
- PAN card
- Salaried: last 3 months’ salary slips and Form 16
- Self-employed: last 2 years’ ITR and business proof
- Bank statements for the last 6 months
- Pro-forma invoice / quotation from the dealer
- Passport-size photographs
- Signed NACH/ECS mandate for EMIs
How to apply
- Choose model and get a quotationAsk the dealer for an itemised on-road price — ex-showroom, registration, insurance and any accessories.
- Compare offersGet a quote from your own bank and from the dealer’s financier. Compare APR, not the headline or flat rate.
- ApplyAt the branch, online, in the bank app or through the dealer, with KYC and income documents.
- Read the KFS and signCheck APR, fees, prepayment terms and EMI date; sign the agreement and NACH mandate.
- Disbursal and deliveryMoney is paid to the dealer; the lender’s hypothecation is recorded on the RC and you take delivery.
RBI rules that protect you
| Protection | What it means for you |
|---|---|
| Key Facts Statement (KFS) | Mandatory for all retail and MSME term loans since 1 Oct 2024; shows the all-inclusive Annual Percentage Rate (APR), EMI schedule and every fee |
| Charges not in KFS | Cannot be levied without your explicit consent |
| Validity | At least 3 working days for loans of 7 days or more — time to compare offers |
| Floating-rate reset (RBI, Aug 2023) | At a rate reset you can choose a higher EMI, a longer tenure (without negative amortisation), switch to fixed rate, or prepay; you get quarterly statements |
Prepayment & foreclosure
| Situation | Rule |
|---|---|
| Floating-rate loans to individuals (non-business) | No prepayment / foreclosure charge — any lender, part or full, from any source of funds |
| Loans sanctioned or renewed from 1 Jan 2026 | RBI (Pre-payment Charges on Loans) Directions, 2025 also bar charges on floating-rate business loans to individuals and MSEs at most banks and large NBFCs; no minimum lock-in |
| Fixed-rate loans | Lender may charge as per the sanction letter and Key Facts Statement |
| Disclosure | Any charge must be shown in the sanction letter, loan agreement and KFS; waived charges cannot be levied later |
Two-Wheeler Loan guides, calculators & lenders
Calculators
EMI, eligibility, affordability and prepayment
Special loans & offers
Zero down payment, superbikes and electric two-wheelers
Getting the loan
Eligibility, documents, credit score, application and status
Costs, repayment & closure
Down payment, total cost, foreclosure and hypothecation
Frequently asked questions
Which bank offers the cheapest two-wheeler loan?
Among the 8 lenders we track, Indian Bank starts lowest at 8.90% (floating, Sep 2026), followed by Bandhan Bank (9.47%, aggregator figure — check with bank), PNB (10.00%), Axis Bank (11.00%) and SBI (11.70%). Your rate depends on your credit score and income.
What is the EMI on a ₹1 lakh bike loan?
At 11% for 3 years the EMI is about ₹3,274, with total interest of about ₹17,859. At 9% it falls to ₹3,180 and at 15% it rises to ₹3,467.
How much down payment do I need for a bike?
Banks usually fund 70% – 90% of the on-road price, so expect to pay 10% – 30% yourself. SBI funds up to 85%, PNB 90% for salaried borrowers, Bank of Baroda 90% on loans up to ₹3 lakh, and Indian Bank 70% – 75%. HDFC Bank funds up to 100% for select customers.
What is the difference between flat and reducing interest rate?
A flat rate charges interest on the full original loan for the whole tenure; a reducing rate charges interest only on what you still owe. A 7% flat rate over 3 years costs about 12.83% on a reducing basis. Since 1 Oct 2024 every lender must show the Annual Percentage Rate (APR) in the Key Facts Statement — use it to compare.
Is there a prepayment charge on a two-wheeler loan?
Not on floating-rate loans taken by individuals — RBI bars it. Fixed-rate loans can carry a charge: for example Axis Bank and HDFC Bank charge up to 5% of the outstanding amount, while PNB and Indian Bank charge nil.
Do electric scooters get cheaper loans?
Some banks offer concessions — SBI cuts 0.50% off its rate for electric two-wheelers and Bank of Baroda has a separate bob Green Wheel scheme. EVs also attract only 5% GST. Check the current status of the PM E-DRIVE purchase incentive before you buy.
What is hypothecation on a bike RC?
Until the loan is repaid, the lender’s name is recorded on the registration certificate (RC) as hypothecation. After closure, collect the NOC and Form 35 from the lender and get the hypothecation removed through the RTO or the Vahan portal.
What credit score do I need for a two-wheeler loan?
Most banks prefer a score of about 700–750 or more for their best rates. Lower scores or no credit history can still get a loan, often at a higher rate, with a bigger down payment or from an NBFC.
Is insurance compulsory when I buy a bike on loan?
Yes. A new two-wheeler must carry 5-year third-party cover, and lenders insist on own-damage cover with their hypothecation noted on the policy for the loan period.
Rates compiled from lenders’ published rate pages and reputable aggregators (dates on each lender page) for comparison only. FinancePortal is not a lender or financial adviser; confirm terms and read the Key Facts Statement before borrowing.