SBI, the country’s biggest bank has increased
the minimum income requirement for availing a car loan to Rs. 2.5 lakh per
annum or Rs. 21,000 per month. This pro-active step has been taken to reduce
the raising non-performing assets in auto loan business.
SBI Car Loans has also increased its interest rates in this regard to 12%. This move put a barrier to those who can’t
afford to buy the car and repay loans. The new income limit of Rs. 2.5 lakh per
annum is considered as safe limit for banks and customers as well.
“The first reaction is to default on auto
loans as the interest rates are much lower than personal loans," a senior
official in bank’s auto loan sector said.
Bank will also check for additional loan
liabilities on customer by due diligence.
