As the festive season unfolds across India, there’s a unique spirit of joy enveloping the country. Beyond its religious significance, the Festival of Lights also holds cherished beliefs in making fresh starts, and for many, this includes the acquisition of new assets, particularly vehicles.
This sentiment is strongly echoed by the number of new vehicles that Indians have purchased during the festivals. As per one of the media stories citing industry estimates, in the months starting from Navratri to Diwali in 2022, passenger vehicle sales soared by a remarkable 45%, translating to around 4 lakh cars from a previous 2.75 lakh, with a clear spike
Fast forward to September 2023, and the momentum hasn’t waned. As per one of the media story, Indian automakers achieved record-breaking monthly sales of 363,733 cars and SUVs in the lead-up to Dussehra and Diwali. Furthermore, for the first time, half-yearly sales breached the two-million benchmark, underscoring buoyant seasonal consumer demand.
But what’s fueling this surge in vehicle sales? Dive a little deeper, and you’ll find a powerful enabler which is the evolving suite of vehicle financing solutions in India.
Vehicle Financing in India: A Key Piece of the Puzzle
With the integration of technology into traditional financing products, purchasing a vehicle has become a more accessible and streamlined experience for many Indians. Digital applications and e-KYC have made the process quicker and reduced the daunting paperwork, making the journey smoother for borrowers.
Another compelling shift in the vehicle financing domain is the rising influence of the younger demographic. Tech-savvy millennials and Gen Z individuals, who prioritize convenience and speed, are now pivotal drivers of demand. Recognising their unique needs, banks are now offering tailored financing solutions with flexible payment terms and even zero down-payment options.
RBI‘s latest data offers a testament to this trend. Outstanding vehicle loans saw a jump of 22% year-on-year to INR 5.09 lakh crore as of May 19, 2023. Banks are consistently innovating their vehicle financing portfolios to cater to this growing demand.
India’s Festive Season: A Prime Time for Vehicle Financing
Beyond the celebrations and traditions, the festive season is also a peak period for consumer spending and financial activity. For potential vehicle buyers, this period comes with many compelling financial incentives. So, what precisely are the factors that make these months the prime window to opt for vehicle financing? Let’s find out.
Festive Discounts
During these months, many leading car dealerships across the country roll out enticing discounts and promotions. The traditional festive spirit now seamlessly intertwines with the modern-day allure of a good deal, making it an especially opportune time for potential car buyers.
Special Promotions
In addition to the discounts from car dealerships, there may also be special financing promotions and offers during Diwali because consumers tend to spend more on new vehicles and automobiles. Collaborations between banks and dealerships often lead to bundled offers that are hard to resist. With consumers more inclined to splurge during this period, the market responds with tailored financial promotions.
Lower Interest Rates
Financially, the season brings more good news. Leading banks and financial institutions tend to offer reduced interest rates on car loans. The result? More affordable financing costs and an added push for consumers teetering on the decision to buy.
Newer Models and Extended Warranty
Manufacturers often unveil brand-new car models around Diwali, complete with extended warranties and attractive service packages. These new releases often come with the latest in automotive technology like enhanced connectivity, automation and user-friendly interfaces, ensuring that buyers get the most up-to-date features.
New vs. Used Cars
Vehicle financing during the festive season isn’t exclusive to just new vehicles purchased right off the showroom floor. It extends to used cars as well, thus providing flexibility and choice to the average buyer. Seasonal offers also often cater to both new and used vehicle segments, so every potential finds tailored offers to fit their needs.
Wide Range of Payment Options
During the festive season, the range of financing options expands to keep pace with the rising demand. Banks and financial institutions often offer more flexible EMI options with varied down payment amounts and adjustable loan tenure, particularly during Diwali.
Quick Approval via Online Applications
With the evolution and integration of technology in banking, applications for vehicle financing are being approved in record time. The paperwork involved has also reduced tremendously, with most loan applications being processed online. Furthermore, with the integration of AI and machine learning, loan approvals are not only expedited but also benefit from enhanced security, ensuring that applicants can trust the system while realizing the dream of purchasing their dream vehicles sooner.
Make Informed Financial Decisions This Diwali
The bottom line is that Diwali marks a time of celebration and new beginnings. With the range of vehicle financing options available, it can be tempting to jump onto the best deal. However, it’s crucial to approach these choices with clarity and understanding.
Financial literacy also plays a key role in ensuring that your decisions align with your long-term goals. So, let this festive season mark the beginning of making informed and sustainable financial choices that light up the path towards a prosperous future.
