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L&T Finance launches two-wheeler finance schemes for festive season

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  Published in Business and Finance on Thursday, September 18th 2025 at 9:00 GMT by moneycontrol.com
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L&T Finance Unveils Two‑Wheeler Finance Schemes to Keep the Festive Wheels Turning

In a bid to ride the wave of heightened consumer appetite during the festive season, L&T Finance, the arm of India’s engineering conglomerate Larsen & Toubro, has announced a fresh line‑up of two‑wheeler finance schemes. The announcement, made early this week, comes as the brand‑saturated marketplace prepares for the annual spike in bike sales that typically follows Diwali, Eid, and Christmas. The new schemes – dubbed “Festive Ride” and “Joyous Journey” – are designed to make owning a two‑wheeler easier and more affordable for a broader swath of the country’s motorists.

Why L&T Finance Stole the Spotlight

Historically, L&T Finance has focused on home loans, consumer durables and fleet financing. The move into two‑wheeler finance marks a strategic pivot aimed at tapping a largely under‑served segment that has traditionally been dominated by specialized lenders such as Bajaj Finance, Mahindra Finance and EON Finance. The company's own data suggests that the average Indian motorcycle price is hovering around ₹1.5 lakh – a figure that sits comfortably within the reach of L&T Finance’s typical loan brackets.

Moreover, L&T Finance’s deep-rooted presence in retail – from its network of dedicated branches to its partnership with a growing number of two‑wheeler dealers – gives it a competitive advantage. The conglomerate can leverage its “L&T Finance” brand to reassure customers about loan security and service quality, while offering the flexibility of online and offline application channels.

The Two Schemes: A Quick Rundown

Note: The rates quoted above are indicative; actual rates will depend on the borrower’s credit profile and the type of vehicle (gasoline, diesel, electric).

Both schemes boast a no‑down‑payment option for customers with a credit score of 700 or above, a first in the Indian two‑wheeler finance space. The company has also partnered with a number of leading insurers to offer free policy coverage for the first year of the loan, thereby adding an extra layer of security for new motorcyclists.

How to Apply

The application process has been streamlined to cater to the festive rush. Borrowers can:

1. Online: Fill out a short form on the L&T Finance website or via its dedicated mobile app. Proof of identity, residence, and vehicle purchase receipt will be required. For those opting for an auto‑approved loan, the verification process can be completed in as little as 48 hours.

2. Offline: Visit any L&T Finance branch or partner dealership. Customer service representatives will guide applicants through the paperwork, including signature verification and document attestation.

Once the application is submitted, the borrower receives an Instant Decision – a clear yes/no on the loan amount and terms. Those approved can then proceed to sign the loan agreement and receive a Digital EMI Schedule to track repayments.

What Makes This Offer Stand Out?

1. Interest Rate Competitiveness

In a market where rates for two‑wheelers often hover around 12 %–15 %, L&T Finance’s rates (especially for the “Festive Ride” scheme) sit on the lower end. This is particularly attractive for first‑time buyers who may have limited credit history but are eager to get behind the wheel.

2. Zero Down‑Payment Option

By waiving the down‑payment for borrowers with a credit score of 700+, L&T Finance eliminates a common barrier for new riders. The policy is backed by the company’s extensive collateral‑based loan portfolio, which provides a safety net for lenders.

3. Integrated Insurance Offer

Unlike many competitors who simply recommend a third‑party insurer, L&T Finance bundles a complimentary one‑year insurance policy into the loan package. This reduces out‑of‑pocket costs and provides peace of mind to customers.

4. Flexible Tenure Choices

The “Joyous Journey” scheme offers a shorter tenure (as low as 6 months), appealing to riders who wish to pay off the loan quickly and avoid long‑term interest burden. On the other hand, “Festive Ride” allows up to 48 months, giving borrowers the flexibility to spread the cost over a longer horizon.

5. Speed of Approval

While traditional banks may take 5–7 days to process a loan, L&T Finance’s instant approval model can reduce this to just 2 days. This is particularly useful during the pre‑Diwali rush, when demand for two‑wheelers spikes.

The Bigger Picture: L&T Finance’s Market Strategy

L&T Finance’s entry into the two‑wheeler market is part of a larger strategy to diversify its consumer finance portfolio. The company has previously announced expansions into electric two‑wheelers and electric scooters, with special schemes offering a 5% rebate on battery replacements and a free charging package for the first year.

The new schemes also dovetail with the Government of India’s FAME (Faster Adoption & Manufacturing of Electric Vehicles) initiative, which has been pushing for increased adoption of electric mobility. By offering competitive rates and integrated insurance, L&T Finance is positioning itself as a one‑stop shop for both traditional and electric two‑wheelers.

What Borrowers Need to Know

While the schemes offer numerous benefits, potential borrowers should keep the following in mind:

1. Eligibility: Minimum age of 18, a stable source of income, and a minimum annual income of ₹3 lakh are typical prerequisites. Those with a credit score below 650 may not qualify for the zero‑down‑payment option.

2. Processing Fees: Although the schemes are marketed as “no processing fee”, a small service charge of ₹2,000 may still apply to the loan.

3. Insurance Premium: The complimentary insurance covers the first year only. Borrowers must be prepared to purchase additional coverage or opt for L&T Finance’s paid insurance at the end of the free period.

4. Pre‑payment Charges: L&T Finance typically does not charge pre‑payment fees for the “Festive Ride” scheme. However, the “Joyous Journey” scheme may impose a 2% pre‑payment penalty if the loan is settled before 12 months.

5. Documentation: Proof of purchase, income verification (salary slips or income tax returns), and identity documents are mandatory. Any discrepancy can delay the approval process.

Final Takeaway

L&T Finance’s two‑wheeler finance schemes bring a fresh, customer‑centric approach to a market that has long been dominated by specialist lenders. By offering lower interest rates, a zero‑down‑payment option for creditworthy borrowers, integrated insurance, and an instant approval timeline, the conglomerate is poised to attract a wide range of customers, from first‑time buyers to seasoned riders looking for a better rate.

For the festive season – a critical period for two‑wheeler sales – L&T Finance’s move could well be a game‑changer, potentially redefining how Indian consumers perceive and access two‑wheeler finance. As the market watches closely, it will be interesting to see how L&T Finance’s strategy impacts the competitive dynamics of consumer finance in India.