Mahindra & Mahindra signs MoU with Indian Overseas Bank for vehicle financing

Monday 26 December 2011, 11:45 AM by Vikas Yogi

Mahindra & Mahindra, the largest utility vehicle maker in the Indian auto market, has tied-up with the leading PSU (public sector undertaking) bank – Indian Overseas Bank (IOB) – to provide easy finance options to the customers for its range of passenger vehicles. Mahindra & Mahindra signed MoU (Memorandum of Understanding) with IOB on Saturday, in Chennai. While from the Mahindra’s side MoU was signed by Mr. Arun Malhotra (Senior Vice-President of sales and customer care), from IOB’s side General Manager K Subrahmanyam exchanged the documents.

Speaking on the occasion, Mr. Subrahmanyam said, "We want to enter into the commercial vehicle financing market. And through this MoU, we are entering into it.” The bank offers loan on commercial vehicles at 12.5 per cent interest.
On the other hand, Mr. Malhotra said while speaking to the reporters that in fact, in the last month alone (December) 10 per cent of sales came through vehicle financing. According to him, the vehicle financing in the last quarter of the year is 30 percent of the sales of such vehicles.

Mahindra & Mahindra is registering a steady growth in the Indian auto market. While the commercial vehicle segment of the firm is growing at 35 to 40 percent, the passenger vehicle segment is registering a sales surge of 20 percent year on year.