Easy Fi­nanc­ing for Su­per­bikes

Consumer Voice - - Bfsi -

In In­dia, the price of a lux­ury bike starts from Rs 5 lakhs and it can go up to Rs 35 lakhs or even more, de­pend­ing on the model. Easy avail­abil­ity of fi­nance from banks as well as NBFCs for high-end twowheel­ers en­cour­ages cus­tomers to take up bike loans. While 60 per cent to 65 per cent of the cus­tomers buy bikes on loan, some of them may go for a loan only to avoid ques­tions from the tax au­thor­i­ties and not be­cause they can­not af­ford it. Pay­ing a huge amount of money up­front may end up catching at­ten­tion. For banks, offering loans for high-end bikes is one way of get­ting high net-worth in­di­vid­u­als (HNI) as cus­tomers. Strangely, many banks of­fer loans for lux­ury two-wheel­ers at rates lower than that for stan­dard two-wheel­ers. How­ever, the tenures may be longer due to high cost of the bike. In some cases, the bank may not have an off-the-shelf loan prod­uct but will tai­lor one to suit the buyer’s needs. Af­ter all, some­one who can af­ford to buy a bike of more than Rs 5 lakhs is a po­ten­tial high net­worth cus­tomer for the lender. The loan amounts are usu­ally 70 per cent to 80 per cent of the bike’s cost, but can also go up to 90 per cent if the bank is happy with the cus­tomer’s pro­file. The mar­ket for high-end bikes in In­dia is at a nascent stage, al­though it is grow­ing. Har­ley-David­son has tie-ups with some pri­vate banks. Bri­tish su­per­bike brand Tri­umph is fi­nanced by a few pri­vate banks un­der a tie-up. The Ital­ian Du­cati is an­other lux­ury bike that is now sold in In­dia. How­ever, only a small per­cent­age of cus­tomers opt for loans for buy­ing such su­per­bikes. While a large sec­tion of the de­mand comes from Delhi and Mum­bai, cities like Ben­galuru, Ahmed­abad and Chandi­garh also have been ex­cel­lent mar­kets as a rich bik­ing cul­ture al­ready ex­ists there. There is also an in­creas­ing de­mand from the south of In­dia, with Kochi, Chennai and Hyderabad lead­ing the pack.

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