As the festive season nears and discounts and offers make a comeback, Federal Bank for its customers has also come up with a completely paperless debit card linked EMI facility for purchase of two-wheelers. The debit cardholders of the bank can book a two-wheeler for as low as Rs. 1 and pay the remaining amount via debit card EMI. Under the option, brands covered are Honda Motorcycle, TVS Motor and Hero MotoCorp.
Interest rate is pegged at 17% for two-wheelers below 500cc engine. Also as against the regular two-wheeler loans, hypothecation of the vehicle in favour of the bank is not to be made. Further under the scheme there is levied no processing charges.
Customers can choose between 3, 6, 9 and maximum 12 months repayment tenure.
The new scheme has been floated for select Federal Bank debit cardholders based on assessment of their repayment capacity. For checking your eligibility for the loan facility you can send an SMS in the format DCEMI to 5676762 or giving a missed call to 7812900900.
Also Federal Bank customers who purchase two-wheeler from any of the 793 Honda Motorcycle dealerships across the country using debit card EMI will get 5% cash back as festival offer.
Should you go for Federal Bank's debit card EMI for purchase of two-wheelers?
This loan facility works similar to personal loan as the hypothecation of two-wheeler is not to be made with the lender. Further 17% interest rate is a fairly high rate and if you have a good credit history, you may be able to secure a personal loan at a lower rate. So, before opting for the debit card EMI scheme, consider all other options available to you for getting the best rate for financing your vehicle.