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Auto Rickshaw Loan
Auto Rickshaw loans are loans offered to borrowers,
usually self-employed individuals, trusts, partnership
firms, organisations, etc., for the purchase of vehicles for
commercial or business purposes. These auto rickshaw
loans are availed by those who are involved in the
transportation business. A Commercial vehicle loan can
be used to purchase buses, trucks, tippers, tankers, light
and small Auto Rickshaws.
Purpose of a Auto Rickshaw Loan
As stated above, Auto Rickshaw loans are availed to fund
the purchase of a vehicle that will generally be used for
commercial or business purposes. The entire process of
Auto Rickshaw loan application is swift, hassle-free, and
requires less paperwork.
Features of Auto Rickshaw Loans
You can get a Auto Rickshaw loan at a low interest if
your profile matches with the criteria put forward
by the lenders.
The processing time of a Auto Rickshaw loan is fast
with easy documentation and approval.
Most of the prominent banks in India provide Auto
Rickshaw loans at affordable rate of interest
without any security.
Some of the banks assign a personal relationship
manager from starting till procurement of the
vehicle. He/she will do all documentation and
address every issue related to the loan.
Once all required documents are submitted, it takes
around 7 days for the disbursal of the loan amount.
Types of Auto Rickshaw Loans
Commercial loans can be availed for a variety of Auto
Rickshaws which are used at different places to serve
various purposes. Based on the type of vehicles these
loans are sought for, Auto Rickshaw finance is
differentiated in three broad categories, namely:
1. New Auto Rickshaw loan
This type of Auto Rickshaw loan is provided to the
customers for the purchase of new Auto
Rickshaws for business purpose. Banks offer up to
100% funding on the chassis or base frame value
of the vehicle. Some of the banks provide
additional funding for the body construction of the
vehicles in selective cases based on the borrower’s
profile.
2. Old Auto Rickshaw loan
Old or used Auto Rickshaw loan are those loans
which are offered to purchase all makes of pre-
owned or used Auto Rickshaws. Under this loan,
borrowers can expect to get finance against old
vehicles which are up to 15 years old. Most of the
banks provide up to 90% funding on the used
vehicle’s value or depreciation grid value.
3. Auto Rickshaw refinancing
Under Auto Rickshaw refinancing, banks either
offer loan on an existing vehicle which is free of
loan or take over an existing Auto Rickshaw loan
and provide additional finance for it based on
eligibility. While some borrowers can reduce the
monthly EMIs of their existing loan and free up
some cash by refinancing an existing loan at lower
interest rates, some others can get direct finance
on their free vehicles to meet the working capital
needs.
Who Can Avail Commercial Car Loans?
Banks and other lenders offer commercial car loan to a
broad array of customers to meet their business needs.
In other words, this type of vehicle loan can be availed
by various segments of customers having diverse
profiles. Here is the list of the consumers considered to
be eligible for this loan:
Individuals
First-time users and buyers
Small, medium and large-sized fleet owners
Proprietorship firms and Partnership firms
Public Limited & Private Limited Companies
Trusts and societies
Schools and colleges
Captive customers and transporters
Salaried and self-employed individuals can co-apply for a
Auto Rickshaw loan with blood relatives or family
members. On the other hand, the partners in partnership
firms and the directors in private limited companies can
jointly apply for this loan.
Benefits of a Auto Rickshaw Loan
Auto Rickshaw loan stands out to be the most preferred
option for borrowers who are either intending to buy
their first Auto Rickshaw or planning to add a new
vehicle to their existing fleet of Auto Rickshaws due to
the plethora of benefits that it offers. Some of the
amazing benefits offered by these type of loans are as
follows:
Flexible repayment tenure- Usually, the repayment
tenure offered in commercial car loan is up to 5
years. This ensures low EMI amount to the
borrowers enabling them to pay off the EMIs
without any undue financial burden.
Multiple vehicle financing- Whether you are an
individual borrower or a fleet owner, you can get
finance for a variety of vehicles such as tippers,
trucks, buses, trailers, tankers, and other small and
light Auto Rickshaws to grow your business.
Easy processing- The process of applying for a Auto
Rickshaw loan is easy, fast and convenient. After
the submission of all the required documents,
banks usually take 4-5 days to process a new or
used vehicle loan application.
Simple documentation- Auto Rickshaw loans come
with a hassle-free and quick documentation
process. The users can easily upload all the
mandated documents online without visiting the
bank directly.
No credit-score compulsion- Unlikely other loans,
Auto Rickshaw loans don’t require any existing
credit score. Borrowers having low or even zero
credit score can avail a Auto Rickshaw loan with
ease.
Caters to multiple needs: The loan schemes are
designed to cater to the borrowers’ diverse
requirements including new and used vehicle
financing, top up on existing loan and refinancing
of loans/vehicles for working capital.
Customised solutions: In order to meet the specific
requirements of the customers, every Auto
Rickshaw loan scheme is customised according to
the vehicle type, loan duration and financial ability
of each individual borrower.
Commercial Auto rickshaw Loan
Documentation
Duly filled application form with attached
photograph
2 passport-size photographs
Cheque for processing fee
KYC documents
Age proof- Aadhaar Card/PAN Card/Voter's ID
card/Driving License/Passport (Any one)
Identity proof- Aadhaar Card/Voter's ID
card/Driving License/Passport (Any one)
Residence proof- Rental agreement/Voter’s ID
Card/Passport/Ration card/Tel bill or Elec.
Bill/Trade License/ Sales Tax Certificate (Any one)
Signature verification proof-Driving License/PAN
Card/Registered Sale Deed/Govt. ID Card (For
Govt. employees) (Any one)
Income proof
Last 3 months Salary Slips
Latest 6 months bank statement
Form No.16
Updated ITR for last 2 years
Photocopy of official ID
Experience proof
Valid documents to prove relevant experience (In
case of first-time buyers)
Other Documents (As applicable)
Existing vehicle ownership proof
Vehicle details & valuation report
Insurance and RC copy of vehicle
Fleet list details (In case of small, medium, and large
fleet operators/owners)
Trade references (In case of first-time buyers, fleet
operators/owners & experienced borrowers)
Property ownership proof (In case of farmers)
Proprietorship decl., partnership deed, (MOA/AOA),
board resolution & 2 years audited financials (In
case of Private/Limited companies, partnership
firms, trusts & societies)
Loan repayment track (if any)
Eligibility Criteria for Auto Rickshaw Loan
For new Auto Rickshaws
Salaried borrowers should have more than 2 years
of employment stability and self-employed
individuals must have at least 2 years of business
experience.
Private/Limited companies, partnership firms, trusts,
societies and associations must be in existence for
minimum 2 years.
Fleet operators and other existing vehicle owners
require to have 1 to 3 years of vehicle ownership
proof of one or two Auto Rickshaws.
Private/Limited companies, partnership firms, trusts
& societies Companies need to provide 2 years of
audited financials.
Internal/external guarantor needed sometimes in
case of individuals, first-time buyers and fleet
operators/owners.
The customers need to have minimum residential
stability of 2 years. *(Borrowers with lesser
stability are subjected to certain terms and
conditions).
For old Auto Rickshaws
Borrowers applying for a commercial car loan for old
vehicles need to fulfil the following criteria along
with the basic ones:
Customers need to have relevant experience of 3 to
5 years depending on individual profile.
Minimum 1 year of ownership of at least 2 vehicles.
At least 1-year repayment track of Auto Rickshaws
Vital Aspects of a Auto Rickshaw Loan
Application process- At first, the borrower needs to
fill up an application form online, then furnish all
the necessary documents and finally provide the
details of the personal guarantor if required.
Loan approval- The bank will run a check to verify
the documents and borrower’s eligibility. If the
borrower is found to be eligible, the loan will be
approved within 2 to 5 working days from the time
of documentation.
Processing charges- Banks ask for a minimal non-
refundable amount for processing a Auto Rickshaw
loan. This amount depends on the amount of the
loan applied for and generally ranges from 2% to
4% of the loan amount.
Loan Amount/Margin- The maximum loan amount
for Auto Rickshaws varies from customer to
customer based on their individual profile. A
borrower can get up funding of up to 100% of the
vehicle’s chassis.
Repayment tenure- The repayment tenure for a
Auto Rickshaw loan usually starts from 6 months
and goes up to 60 months (5 years). The borrower
is allowed to repay the amount in easy monthly
EMIs.
Security/collateral- While certain banks offer loans
for Auto Rickshaws without any security or
guarantor, some require a guarantor or co-
applicant depending on the borrower’s profile and
the product.
Pre-payment of loan- The borrowers can prepay the
loan after 6 months of availing it by paying a pre-
payment fee of up to 5% of the remaining loan
amount. However, part pre-payment of the loan is
usually not allowed.
COST SHEET
PARTICULARS AMOUNT (RS.)
Infrastructure* 44,00,000
Staff Salary 10,50,000
Interior 3,00,000
Electricity Charges 80,000
Domain** 3,91,000
Miscellaneous 5,00,000
TOTAL 67,21,000
*Data from 99acres.com (Property owner- Asad
Farooqui – 9873790631)
**Data from GoDaddy.com
QUESTIONNAIRE DATA
