Tag: auto loans

M&M ties up with SBI for small CV financing, BFSI News, ET BFSI

Personal Finance

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New Delhi: Mahindra & Mahindra (M&M), one of the top commercial vehicle manufacturers in India, on Monday inked a Memorandum of Understanding (MoU) with the State Bank of India (SBI) to offer financial assistance for the purchase of M&M’s range of small commercial vehicles and PickUps. SBI’s Contactless Lending Platform technology will further ensure uniformity, transparency and a reduced turnaround time in the loan approval process, the automaker said in a release.

Amit Sagar, business head – SCV, automotive division, M&M, said, “Our financing scheme is not just unique, but also very pertinent, given SBI’s reach and trust across the length and breadth of the country. This scheme will provide the desired impetus and confidence to our SCV and PickUp customers and help them prosper.”

The collaboration with SBI will allow M&M’s small commercial vehicle customers to avail of loan in a contactless manner with only 59 minutes loan approval process. This will help customers own a superior product with EMI as low as INR 6666 (for a loan amount of 3.45 lakh) and a lower interest rate of 11.5%, the company said.

It also gives flexibility of extended tenure up to six years including a one-month moratorium period also. The customers can opt for a higher loan amount with up to 85% on-road funding. There is no requirement of any third-party guarantor, M&M added.

Along with MSME, small road transport operators and the first-time-buyers of small commercial vehicles can also take benefit from this breakthrough M&M vehicle financing scheme with SBI, the automaker highlighted.

M&M recently launched the SUPRO Profittruck range which is developed on the SUPRO platform. The SUPRO Profittruck range comes in both diesel as well as CNG fuel options. The Jeeto brand launched in 2015,has thus far gone home to 2 lakh customers. In sub 2-tonne load category, it comes with multi fuel options of Diesel, CNG & Gasoline and in two different deck sizes providing an array of options to customers.

Mahindra Bolero PickUp range has been the market leader for over two decades with more than 16 lakh customers, claims the company. Mahindra Bolero PickUp has a wide range of vehicles – Single cabin, Double cabin, AC, 4WD and CNG options along with multiple payload and cargo sizes suiting the customer requirements.



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HDFC Bank to refund GPS device commission to auto loan customers

Banking & Finance

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Private sector lender HDFC Bank has said it will be refunding the GPS device commission to auto loan customers who availed of such device as a part of the auto loan funding during fiscal years 2013-14 to fiscal year 2019-20.

“The refund will be credited to the customer’s repayment bank account registered with the bank,” HDFC Bank said in a public notice in a newspaper on Thursday.

The bank has been in the midst of a controversy over alleged mis-selling of GPS devices to its auto loan customers.

Reserve Bank of India had on May 28 imposed a monetary penalty of ₹10 crore on HDFC Bank. This came after the central bank found irregularities based on a whistleblower complaint in the bank’s auto loan portfolio.

An examination of documents in the matter of marketing and sale of third-party non-financial products to the bank’s customers, arising from a whistleblower complaint to RBI regarding irregularities in the auto loan portfolio of the bank, revealed contravention of the provisions of the Act and the regulatory directions, the RBI had said.

HDFC Bank had last year conducted an internal investigation into allegations that customers of its car loans were being given GPS devices without their knowledge. The allegations had initially come up on social media.

The lender’s former Managing Director and CEO Aditya Puri at the annual general meeting on July 18 last year had confirmed that the bank conducted an inquiry into vehicle loans and appropriate action has been taken against employees involved in the misconduct.

The incident had also led to the exit of a number of executives from the bank. The cost of the device is understood to be about ₹18,000.

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SBI offers revamping of loan for personal segment borrowers

Banking & Finance

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State Bank of India (SBI) has announced offering restructuring of loans to its eligible personal segment borrowers who availed home loans, Xpress credit, education loans and auto loans before April 1, 2021.

According to the bank, the eligible borrowers may access the following link and opt for restructuring (under Resolution Framework 2.00).

The link: https://covid19restruct.sbi.co.in:8443/EMIRestruct/EMI_CustomerLogin.jsp

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RBI imposes monetary penalty of ₹10 crore on HDFC Bank

Banking & Finance

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The Reserve Bank of India has imposed a monetary penalty of ₹10 crore on private sector lender HDFC Bank. This came after the RBI found irregularities based on a whistleblower complaint in the bank’s auto loan portfolio.

“This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” the RBI said in a statement on Friday.

The penalty is imposed for contravention of provisions of section 6(2) and section 8 of the Banking Regulation Act, 1949 (the Act), it further said.

An examination of documents in the matter of marketing and sale of third-party non-financial products to the bank’s customers, arising from a whistle blower complaint to RBI regarding irregularities in the auto loan portfolio of the bank, revealed, contravention of the provisions of the Act and the regulatory directions.

Also read: HDFC Bank commits ₹100 cr under Parivarthan for fighting the pandemic

“In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for contravention of the provisions of the Act and directions,” the RBI further said said.

After considering the bank’s reply to the show cause notice, oral submissions made during the personal hearing and examination of further clarifications and documents furnished by the bank, RBI came to the conclusion that the aforesaid charge of contravention of provisions of the Act was substantiated and warranted imposition of monetary penalty, it further said.

HDFC Bank had last year conducted an internal investigation into allegations that customers of its car loans were being given GPS devices without their knowledge. The allegations had initially come up on social media.

The lender’s former Managing Director and CEO Aditya Puri at the annual general meeting on July 18 last year had confirmed that the bank conducted an inquiry into vehicle loans and appropriate action has been taken against employees involved in the misconduct. The incident had also led to the exit of a number of executives from the bank.

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Report, BFSI News, ET BFSI

Banking & Finance

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More women have resorted to unsecured personal loan borrowings rather than home loans or auto loans during the pandemic, a report said on Thursday. Personal loans, which are typically consumption loans borrowed without any security to meet expenses, have witnessed a 23 per cent year-on-year rise in the number of women borrowers in the first nine months of 2020-21 (FY21) till December, as against a 5 per cent growth in Home Loans segment, the report by CRIF High Mark, a credit information company, said.

The COVID-19 pandemic resulted in deeper financial issues in some households as the pandemic and the resultant lockdowns hurt financially.

The active loans to women borrowers stood at 6,482 in the personal loan segment, as against 4,354 home loans, while auto loans witnessed a 4 per cent de-growth to 1,818 women borrowers, the report released in the run-up to the women’s day said.

Women’s share in the overall personal loan and auto loan pie has increased by one percentage point to 16 per cent now, the report said, adding they constitute 29 per cent of the home loans market.

The company data said average ticket size of personal loans borrowed by men and women has reduced by 10 per cent and 5 per cent, respectively, over the past one year.

The average size of loan borrowed by women continues to be smaller than that borrowed by men, while the average auto loan size borrowed by women is 8 per cent higher than that borrowed by men.

The share of top five states in the personal loan portfolio outstanding for women has increased by 18 per cent over the previous year, and women borrowers from southern states have higher credit book size as compared to western and northern states, it said.

A total of 1.8 crore loans – split into 18 lakh auto loans, 15 lakh home loans and 1.5 crore personal loans – were given out in the first three quarters of 2020-21, it said, adding that this was 40 per cent lower than the 2.97 crore in the year-ago period.

In terms of the value of loans disbursed to women borrowers, public sector banks have had the largest share observed over the past four quarters, followed by NBFCs and private banks, it said.

Maximum loans are given to women in the age group 26-35 having a share of 40 per cent in the overall disbursements in the year 2020, it said, adding that 6.26 crore women borrowers have a credit history as of now.



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