How To Buy A Bike On EMI : Know Factors, Benefits & Instalment Options

Last Modified: 18-January-2023

Buy Bike on EMI

The festive season is here, and you would like to indulge in some self-pampering or buy gifts for your loved ones? The latest and amazing bike can be a perfect gift! So, how do you fit this purchase within your budget?

You want a new bike, but your bank refuses to give you a loan. Or maybe you just don’t have a bank account. Maybe you’re a student and you aren’t allowed to have a loan.

And then, one day, someone told me about EMI or Equated Monthly Instalments. You know what EMI is, right? It’s when you buy something expensive on credit and pay for it in small monthly installments spread across several years. So if it’s an electronic item with a warranty of three years, the company will let you buy it in three-year installments.

Two wheelers are now available to buy on EMI at many online and offline stores. When you buy two wheeler on EMI, it allows you to pledge a convenient amount monthly/weekly/daily without overwhelming your budget.

Instalment Options on Buying a New Bike

Buying 2 wheeler without making significant commitments works in two ways:

Option 1 – Buy the product and then pay on EMI

It is what it sounds like, buy a bike on EMI. This is simple – when buying a two wheeler online, go for the EMI option. You can opt for flexible plans ranging between 3 to 24 months.

Option 2 – Join a saving scheme with a store

Think of it as a monthly investment plan. Here you will have to keep depositing a certain fixed amount every month with your preferred auto shop. The programs are generally for a minimum of 12 months.

One where you buy the product and then pay on EMI

How to Avail the Bike on EMI Plans?

To avail of the EMI plans, you need to produce your PAN card, proof of address, and income. If these two criteria are fulfilled, verification will be done, and you will be approved to buy the best bike loan. For those who don’t know how to buy a bike on EMI, we have made a list of 9 steps as follows:

Check Eligibility

You need to select the bike and with Muthoot Capital you can check two eligibility with a list of documents required to buy a bike on EMI.

Calculate EMI

After checking the eligibility. You can use Muthoot Capital Two wheeler loan EMI calculator to get an idea about the estimated EMI per month on the basis of Loan Amount, Tenure & Interest Rates .

Apply Loan Online

Once you get an Idea about the EMI Plans, Now you can apply for a two wheeler loan online by visiting the application page. You can also visit a Muthoot FinCorp Two Wheeler Loan Branch near you – Locate Now

Nowadays most people prefer to buy goods with easy installment plans, which are mostly available through banks or through the Internet. Banks are most preferred because they are far better at it than the Internet.

The advantage of this system is that you can own a lot of things without spending much money.

It is what it sounds like, buy bike on EMI. This is simple – when buying two wheeler online, go for the EMI option. You can opt for flexible plans ranging between 3 to 24 months.

One where you join a saving scheme with a store

Think of it as a monthly investment plan. Here you will have to keep depositing a certain fixed amount every month with your preferred auto shop. The programs are generally for a minimum of 12 months.

Benefits of Buying a Bike on EMI

No big commitment

Who doesn’t want to possess a brand new two wheeler without making it a huge spend at one go? Here’s the good news – buying a bike with the access of checking two wheeler loan EMI calculator is convenient and does not break your monthly budget.

1. Flexible EMI Periods

Several two wheeler brands and stores offer flexible tenures according to your affordability. The tenures start from 2 months and go up to a year. Some retailers, such as Muthoot Capital, also have daily and weekly options available when applying for bike loans online.

2. Fixed Gold Value

As you must know, branded and luxury bikes fluctuate each day. And as an appreciating asset, the value is likely to go up rather than down. In addition, when you buy a bike on loan, the value of the day it is purchased gets fixed, thus protecting you from price inflation.

Additional Read: Zero Down Payment Bike Loan

Factors to keep in mind while buying a bike on EMI

1. Credit Score

Your Credit Score is one of the most important factors when it comes to taking a loan. It is a number assigned to you by credit rating agencies, which consider numerous facets including the number of loans you’ve taken, the loan amounts, whether you made timely payments or missed them and so on. The Score is out of 900, and anything above 700 is deemed a good score. The bike loan interest rates will depend on this score, and you can get a low interest rate if your rating is good.

2. Loan Amount

The interest rate also depends on the total amount of the loan you are asking for. The higher the cost of your bike, the more the loan you will need. Thus, this also increased the interest rate, as the financial institution is taking a bigger risk in awarding you with a loan of a higher amount as it increases your chances of defaulting. This justifies their cost.

3. Loan Tenure

Your bike loan EMI price depends on your loan tenure. If you have a high monthly EMI price, the interest rate will be lower, as it reduces the risk of you defaulting. If you have a long tenure, and thus a lower EMI rate, your rate of interest will be much higher. This is a general rule followed in banking. You can use a bike loan EMI calculator to calculate the best option for you.

4. Dealership Location

Prices also depend on the dealership location. As you know, the price of the bike has small variations depending on the dealership location as each distributor has different costs and different local tax amounts. Thus, in order to get the best deal in the bike loan interest rates ensure you choose a dealership that gives a good price.

5. Secured Vs Unsecured Loan

A secured loan is one where you must pledge an asset to the bank as security or collateral. This reduces the rate of interest as there is less risk for the bank in giving you the loan.

Unsecured loans are loans where you do not pledge collateral, and thus have higher rates of interest to justify their risk. You must choose whichever option works best for you.

FAQs

1. Is it good to buy a bike on EMI?

Yes, you can buy a bike on EMI and get various benefits.

Some of them are mentioned as below –

  • When you buy a bike on EMI, you will not be emptying your bank account.
  • EMIs keep your bike from becoming a financial burden.
  • You can also avoid the down payment of your bike when you choose a 0 down payment loan.
  • Buying a two wheeler online these days is hassle-free as most lenders follow paperless procedures.
  • The approval time for a bike loan is not more than one business day.
  • The EMIs for bike loan schemes are pocket-friendly.
  • Buying a bike on EMI without interest is the most affordable option.

2. Can we pay bike EMI online?

Yes, you can. Leading lenders offer their clients the option to pay bike EMI online using internet banking as well as UPI. Simply select the online EMI payment option and follow on-screen instructions for the best results.

3. Can I buy a bike with zero down payment?

Yes, countless lenders in India offer 0 down payment bike loans. The only cost that you would need to bear is the processing fee – that is it!

4. What is no cost EMI?

No cost EMIs allows you to pay back your lender only the MSRP of the product.

Interest rates are not applicable on loan schemes with no-cost EMIs.

For example –

If you buy a bike online on EMI costing Rs. 1, 80,000 with 6-month tenure through a no-cost EMI loan scheme, you will pay back the debt in EMIs without any interest.

About Author
Muthoot Capital Services Limited is one of India's most progressive financial companies. It is the part of Muthoot Pappachan Group which carries a legacy & trust of more than 133 years.
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