How to Choose the Best Two-wheeler Loan


Purchasing a bike can be an exciting experience, offering you the freedom to zip through traffic and explore new horizons. However, not everyone has the financial means to buy a two-wheeler outright. That’s where bike loans, or two-wheeler loans, come into play. These loans allow you to own your dream bike while spreading the cost over manageable monthly installments. In this article, we’ll explore the key factors to consider when selecting a two-wheeler loan.

Evaluate Your Two-wheeler Loan Eligibility

Before you dive into the world of bike loans, it’s essential to determine your two-wheeler loan eligibility. Lenders have specific criteria that applicants must meet. Here’s a checklist of factors that influence your eligibility:

1) Age: Most lenders set a minimum age limit for loan applicants, typically around 21 years. However, these limits may vary from one lender to another.

2) Income: Your monthly income plays a significant role in determining your eligibility. Lenders want to ensure that you have a stable source of income to repay the loan. Check the minimum income requirement set by the lender.

3) Credit Score: A good credit score enhances your eligibility. Lenders often prefer applicants with a credit score of 750 or higher. If your score is below this threshold, work on improving it before applying for a bike loan.

4) Employment Stability: The applicant having a stable job or business with a regular source of income is usually preferred by lenders.

5) Existing Financial Commitments: Lenders assess your current financial obligations, such as existing loans or credit card debts.

Research Various Lenders

Once you have a clear picture of your two-wheeler loan eligibility, the next step is to research various lenders in the market. You can approach banks, non-banking financial companies (NBFCs), and online lenders. Each option has its pros and cons. Here are some aspects to consider when evaluating lenders:

1) Interest Rates: The interest rate is a crucial factor that affects the overall cost of your bike loan. Different lenders offer varying interest rates. Compare them and choose the one that suits your budget.

2) Loan Tenure: The tenure of the loan determines the duration of your monthly payments. Longer tenures result in lower EMI but higher interest costs in the long run. Choose a loan tenure that aligns with your financial goals.

3) Processing Fees: Most lenders charge a processing fee for approving your two-wheeler loan. Compare the processing fees of different lenders and factor this cost into your decision.

4) Prepayment Charges: Some lenders levy prepayment penalties if you decide to pay off your loan before the scheduled tenure ends. Look for lenders with minimal or no prepayment charges if you plan to make early repayments.

6) Customer Service: Good customer service is essential in case you need assistance or have queries during your loan tenure. Research customer reviews and feedback to gauge the quality of service provided by the lender.

Assess Loan Amount and Down Payment

The loan amount you can borrow and the down payment you must make are critical aspects of your two-wheeler loan. Typically, lenders offer up to 80-90% of the bike’s on-road price as a loan amount. However, this percentage can vary, so it’s crucial to verify with your chosen lender.

Your down payment is the initial amount you need to pay when purchasing the bike. The remaining cost is covered by the loan. It’s advisable to make a substantial down payment, as this reduces the loan amount and, consequently, the interest you’ll pay. A lower loan amount also ensures that your monthly EMIs are more manageable.

Review the EMI Structure

Your Equated Monthly Installments (EMIs) are the periodic payments you make to repay your two-wheeler loan. When choosing the best bike loan, it’s essential to assess the EMI structure. Here are some factors to consider:

1) EMI Amount: Calculate the EMI amount using free EMI calculators available online. Ensure that the EMI fits comfortably within your monthly budget.

2) Frequency of Payments: Some lenders offer flexibility in choosing your EMI payment frequency, such as monthly, quarterly, or semi-annually. Select the one that aligns the best with your financial situation.

3) EMI Date: Check if the lender allows you to select your preferred EMI date, making it easier to align your payments with your salary receipt.

Check for Pre-Approved Offers

Before finalising your bike loan, check if you are eligible for any pre-approved loan offers from lenders. Pre-approved offers are tailored to your financial profile and often come with benefits like lower interest rates and quicker loan processing. Be sure to explore these offers to secure the best deal.


Choosing a two-wheeler loan offer is a crucial decision when you’re planning to buy a bike. To make an informed choice, assess your two-wheeler loan eligibility, research various lenders, evaluate interest rates, processing fees, and other charges, and carefully review the EMI structure. Don’t forget to check for pre-approved offers. By following these steps, you’ll be well on your way to financing your dream bike while keeping your financial health in check.