7 hrs ago
PSU Car Loan Rates Start at 7.35% in September 2026
Banks charge interest when they lend money for a car.
In September 2026, some public-sector banks advertise car-loan rates starting below 8%.
UCO Bank has the lowest starting rate in the table, at 7.35%.
State Bank of India’s starting rate is higher, at 8.70%.
For a ₹5 lakh loan paid back over five years, the monthly payment can differ considerably between banks.
The rate a borrower actually receives may depend on credit history, income and other eligibility factors.
A longer loan term can make monthly payments smaller but may increase the total interest paid.
Borrowers should compare fees and early-repayment rules, not just the advertised rate.
Public-sector banks are offering car loans at starting interest rates below 8%, with rates varying by borrower profile.
UCO Bank lists the lowest starting rate at 7.35%, while State Bank of India’s rates start at 8.70%.
For a ₹5 lakh loan over five years, monthly EMIs range from ₹9,983 to ₹11,647.
Processing fees range from zero at some banks to as much as 0.5% of the loan amount.
Borrowers are advised to compare total repayment costs, fees, tenure, affordability and prepayment terms before choosing a loan.
- Who
- Individuals seeking car loans from public-sector banks and other listed lenders.
- What
- A comparison of car-loan interest rates, five-year EMIs and processing fees.
- Where
- Across prominent banks operating nationwide in India.
- When
- Rates and charges were stated as of 16 September 2026.
- Why
- To help prospective car buyers compare the full cost and terms of different loans.
Key facts
- Lowest starting rate
- UCO Bank: 7.35% per year.
- Highest starting rate
- State Bank of India: 8.70% per year.
- Loan example
- ₹5 lakh borrowed for five years.
- EMI range
- ₹9,983 to ₹11,647 per month.
- Lowest listed EMI
- UCO Bank: ₹9,983.
- Processing-fee waivers
- Central Bank of India lists no fee until 31 December 2026; Indian Overseas Bank lists no fee in the table.
- Data source
- Paisabazaar.com; rates and charges dated 16 September 2026.
Sources
Related news
Personal Loan Rates Start at 8.90% Across Eight Banks
Higher Rates Add Nearly ₹46 Lakh to Home-Loan Costs
Home Loan Rates Across Banks and Housing Finance Companies
Home Loan Rates Across Indian Banks and Housing Finance Companies
PSU Bank FD Rates Below 7% as Rivals Offer More
Used-Car Loans Vary by Vehicle Value, Borrower Profile, Costs
Fixed Deposit Interest Rates Across Indian Banks on September 18
Government Denies Fake Viral Notification Claiming Public Sector Bank Mergers
Central Bank of India Receives First Rajbhasha Kirti Award
NCLT Approves ₹7.42 Crore Plan Despite ₹560 Crore Claims
