Honda Seil Cars India approaches public sector banks to finance its range of vehicles in smaller cities across the country.
The car manufacturer has signed a memorandum of understanding with the Punjab National Bank (PNB). According to the terms and conditions of the partnership, PNB will provide finance of up to 90% of the on-road price of the car with a tenure ranging up to seven years at an interest rate of 10.5% to 11%. The agreement also states that PNB will provide working capital requirements for its dealerships at the rate of its Prime Lending Rate (PLR).
On this account the Senior General Manager of Honda, Jnaneshwar Sen said, “Public sector banks have strong presence in Tier II cities and we have also expanded rapidly in those places. Partnering a bank like the PNB will help us enhance our presence in these smaller cities.”
In future the company also plans to tie-up with other public sector banks like the State Bank of India because these banks hold good strength in smaller cities.