Strong points :
- Despite some setbacks in the auto industry, HDFC Bank is looking to triple its funding for electric vehicle (EV) purchases in the next three years.
- Tata Motors produces around 80% of the cars financed by HDFC Bank, with the remaining 20% going to MG Motors and Hyundai.
Despite some setbacks in the auto industry, HDFC Bank is looking to triple its funding for electric vehicle (EV) purchases in the next three years. This is due to an initial assessment that the loans are proving profitable.
The banking institution aims to triple the ebook dimension by 2025 after initially testing the waters with loans for 589 EV purchases and an ebook dimension of 5,100 crores.
According to Vikas Pandey, Head of Auto Loans at HDFC Bank, “We are actively pushing financing for electric vehicles in line with our goal to become carbon neutral by 2031-32. We are industry leaders in passenger vehicle financing. We finance 15 to 17 electric vehicles out of 100 sold. We therefore hold a market share of almost 15%.
According to the data, 3,800 electric passenger vehicles were purchased in October and HDFC Bank financed 589 of these vehicles. In October, the financial institution disbursed similar loans of 170 crores.
According to Pandey, “We are seeing at least a 2.5x growth this year in terms of the amount of vehicles financed. The numbers are expected to increase from now on and we expect a 3x increase over the next three years. We want to have a market share of over 20% by 2025.”
The finance company offers eight-year mortgages with interest rates starting at 8.05%. The typical mortgage note size is Rs 17 lakh. As access to charging infrastructure continues to be a barrier to widespread adoption of electric vehicles across the country, 80% of demand is concentrated in metropolitan areas and other hard-to-reach locations.
In India, there are 2,500 EV chargers spread across 270 cities. In Maharashtra, there are about 500.
According to Pandy, Tata Motors product approximately 80% of automobiles financed by HDFC Bank, with the remaining 20% going to MG engines and Hyundai. The market is set to grow with the entry of Chinese competitor BYD in India and M&M which is expected to introduce its electric vehicle.
19,500 electric passenger cars were purchased in the country last year. Until October this year, 20,500 cars had been purchased.
Less than 1% of passenger cars on the road today are electric vehicles.
By 2030, India’s electric vehicle finance market is expected to reach $50 billion (INR 4.1 lakh crore), with 30% of personal vehicles, 70% of commercial vehicles and 80% of two- and three-wheelers of the country with an electric motor. powertrain.
Several Indian banks offer green car loans, a lucrative financing option for consumers looking to purchase zero- or low-emission vehicles. These green auto loans offer lower interest rates, among other benefits. Banks such as SBI (Green Car Loan), Union Bank (Union Bank Green Miles), Axis Bank currently offer these loans.