SBI lists fixed new-car loan rates of 8.40% to 9.35% a year. PNB and Canara publish different rates for eligible borrower groups, while HDFC and ICICI have conflicting figures across their own disclosures. That makes the conditions beside a rate just as important as the number itself.
Official sources checked: 6 October 2026. The figures below are a dated comparison of selected bank disclosures, not a personalised sanction quote or a ranking of every lender. Confirm the rate, repayment schedule and charges in writing before accepting a loan.
Car loan interest rates in India: bank comparison
| Bank | Published rate and important conditions |
|---|---|
| SBI | Fixed new-car range: 8.40%–9.35%. Credit score and tenure affect the applicable rate. Official SBI rates. |
| PNB | For example, eligible individual non-EV borrowers with a CIBIL score of 750 or above: 7.65% floating / 8.65% fixed. EV offers start at 7.60% floating / 8.60% fixed. Check the borrower-category and credit-score rows. Official PNB table. |
| Canara Bank | Prime-risk-grade non-EV loans above ₹15 lakh: 7.50% for women / 7.55% for others. Up to ₹15 lakh: 7.90% / 7.95%. These are RLLR-linked rates; the concession stays unchanged until three years from first disbursement; confirm later terms. Official Canara table. |
| Bank of Baroda | New-car range: 7.60%–11.30% floating or 8.50%–11.20% fixed. Its table also has insurance-linked pricing conditions; request costs with and without the optional cover. Official Baroda rates. |
| ICICI Bank | Product page: 8.40% onwards for tenure above 36 months; 10.25% onwards below 36 months. Product rates. Its rate overview instead says 8.50% onwards. Confirm the quote, including exactly 36-month loans. |
| HDFC Bank | Main table: 9% onwards; FAQ on the same page: 9.40% onwards. The disclosure is inconsistent, so neither figure is a guaranteed offer. Official HDFC disclosure. |
| Axis Bank | Main table: 8.90%–11.70%, fixed. Its FAQ gives a different upper limit of 11.80%. Confirm which applies to your application. Official Axis disclosure. |
| Union Bank | A current numeric rate could not be verified from the accessible disclosure. Do not rely on the previously stated 7.40%. Request a dated quote through the official Union Vehicle page. |
“Onwards” means a starting rate with eligibility conditions. A past quarter’s minimum disbursed rate is historical data, not necessarily an offer available today. Compare quotes for the same vehicle, loan amount, down payment and tenure.
Fixed or floating: read the rate type first
A fixed-rate quote and a floating-rate quote are different products. SBI labels the new-car range above as fixed; Canara’s table is linked to its Repo Linked Lending Rate (RLLR). Ask a lender how any benchmark change affects your repayment schedule and whether the contract permits a reset. Do not assume an RBI rate cut will automatically lower an existing fixed-rate EMI.
Why your rate may differ from the headline
Your credit profile, tenure, loan amount, vehicle and the lender’s borrower category can affect the offer. The Canara figures above illustrate why a rate for a larger loan should not be used to estimate a smaller one. There is no single credit-score threshold or interest-rate surcharge that applies across all banks.
Electric and used-car loans need separate quotes
An EV offer should be compared with the lender’s equivalent non-EV offer. For example, Canara lists 7.45% for Prime-grade green vehicle loans above ₹15 lakh, but 7.80% up to ₹15 lakh. These are conditional floating-rate entries, not rates for every new car.
SBI’s certified pre-owned range is 10.45%–15.60%, separate from its new-car range. Do not assume every used-car loan costs a fixed percentage more. Ask for the vehicle-age conditions, valuation, rate and fees for the exact car.
Compare the total borrowing cost, not just the EMI
Request the Key Facts Statement, annual percentage rate (APR), amortisation schedule and a rupee breakdown of charges. ICICI explains APR as an annualised cost that includes interest and origination fees. A lower headline rate can still come with costs you need to compare.
HDFC’s main table lists processing fees up to 0.5% of the loan amount, with a ₹3,500 minimum and ₹8,000 maximum, plus ₹700 documentation charges; applicable taxes are extra. Check the dated quote rather than assuming these charges apply at every bank.
Illustration: what a two-percentage-point difference costs
For an illustrative ₹10 lakh loan repaid through 60 equal monthly instalments, the EMI is about ₹20,517 at 8.5% and ₹21,494 at 10.5%. Total interest is approximately ₹2,30,992 and ₹2,89,634 respectively: a difference of about ₹58,642. These are standard monthly reducing-balance calculations using unrounded EMIs; fees, taxes, insurance and lender rounding are excluded. They are not current bank quotes.
Check prepayment and late-payment terms
Before accepting a loan, ask whether part-payment or foreclosure charges apply to that specific contract. The rate type, borrower purpose, sanction date and terms matter. Do not treat a bank name as proof that repayment will be charge-free.
Late payment can involve normal contractual interest and separate penal charges. RBI’s penal-charge directions distinguish penal charges from an extra penal interest rate and prohibit interest being compounded on those charges. Check the lender’s current fee disclosure and contract; the earlier blanket claim of an extra 18% penal interest rate is not a reliable rule.
A practical quote checklist
Ask each lender for the rate and whether it is fixed or floating; EMI and tenure; total interest; processing, documentation and other charges; optional insurance costs; prepayment terms; and the repayment schedule. Compare dealer-arranged finance with a direct bank quote using the same car price and discounts. A small EMI should not hide a longer repayment period.
Frequently asked questions
Which bank has the lowest car loan interest rate?
This selected comparison cannot establish the market’s lowest rate. Eligibility conditions differ, some disclosures conflict, and Union’s current number was not verified. Compare written offers for your own application rather than choosing from a headline alone.
What is SBI’s current car loan interest rate?
In the official table checked on 6 October 2026, SBI’s fixed new-car range is 8.40%–9.35%. Separate loyalty, EV and used-car products have their own rows. Check the product and eligibility conditions before applying.
What rate should I use for an HDFC or ICICI EMI estimate?
Use the rate from your dated written quote. Both lenders have inconsistent figures in the disclosures noted above. Until the applicable rate is confirmed, a calculator result is only an illustration.
This comparison provides general information. It does not recommend a loan or establish eligibility. Rates and charges can change after the source-check date.
Last Updated on 2 weeks ago by Team Paisaseekho
