SBI, sole booking agent for Nano, freezes car loan rates at 10 per cent

The State Bank of India (SBI), the sole booking agent for the world's cheapest car, Nano, being built by Tata Motors, today said it has frozen interest rates on its car and agricultural loans.

''SBI has been selected as the sole booking agent for Nano," SBI chief general manager (Bengal Circle) J K Sinha said.

The bank will freeze interest rates on new car loans at 10 per cent for a period of one year to give a big boost for the struggling automobile sector, the bank said in a release, adding, it has also slashed lending rate on credit to farmers against cold storage and warehouse receipts to 8 per cent.

The new rates will be applicable to all customers availing loans between 23 February and 31 May 2009, SBI said.

The rates will be reset at the applicable card rate contracted as on the date of sanction under the respective schemes after the freeze period, the release said.

SBI last week froze interest rates on new home loans at eight per cent for one year (See: SBI freezes home loan rates at 8 per cent for one year).

The Nano is being rolled out from Tata Motor's facilities at Pantnagar and Pune in limited quantities and SBI said it will announce details about booking in the next 15 days.

The Rs1-lakh Nano has attracted much attention ever since its was unveiled at the Auto Expo in New Delhi last year. Its launch, however, has been delayed after Tata Motors was forced to relocate the plant from Singur in West Bengal to Sanand in Gujarat.