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HDFC Bank to offer pre-approved car loans

Lender working on interfaces with car makers which allows it to offer instant pre-approved loans to vehicle buyers.

, ET Bureau|
Updated: Sep 11, 2019, 08.05 AM IST
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MUMBAI: HDFC Bank is offering pre-approved vehicle loans to customers o n the websites of car makers, creating application programming interfaces (APIs) that will help India’s biggest car financier strengthen its presence in a line of business it already leads.

Ashish Nayar, senior vice-president at HDFC Bank, said the bank’s new customer interface will help connect prospective car buyers to companies or car aggregators by giving them pre-approved loans based on their credit history and transactions with the lender.

road-ahead

India’s most valuable bank is already in talks with Hyundai, Maruti Suzuki, Kia Motors, MG Cars and Mahindra & Mahindra to link their interfaces with HDFC Bank, allowing the lender to offer interest rates based on the prospective customer’s credit history.

“Open API banking allows HDFC Bank to give universal access to developers/third parties to source customers’ applications directly from any third party websites/ apps. It enables better service offerings and improved customer engagement,” Nayar said.

HDFC Bank has about 40 million customers and a total vehicle loan book of ?85,000 crore — the largest in the market.

It already offers pre-approved loans for its own customers through its own website. It will offer this facility through partner websites. Already 25% of the bank’s vehicle loans are offered through its online channel.

Nayar said this new initiative will help lower credit and operating costs and pass on discounted loan rates to consumers without any foreclosure or processing fees.

This new initiative from the bank comes at a time when the auto segment is undergoing one of its worst slowdowns.

Domestic passenger vehicle sales fell for the tenth straight month in August, declining 31.57%, the latest monthly data from the Society of Indian Automobile Manufacturers (SIAM) showed. This is the worst-ever fall since SIAM started recording the data in 1997-98.

Vikas Jain, head of sales at Hyundai, said HDFC Bank’s new product will help in making sales fully digital.

“If today’s millennials want a car at 11 pm, they can do that by logging on our site. They don’t even have to depend on the dealer to tie up financing,” Jain said. “They can just log in, select the type and colour of the car, and also choose the dealer from which they want to buy because they already have a loan from HDFC Bank. We are still integrating our platforms and hope to roll it out in the next few months.”




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