How Used Bike Finance Helps You Afford Two-Wheelers Through EMI

While passenger vehicles account for the majority of purchased vehicles in India, two-wheelers are not far behind. According to the India Two Wheeler Market report by Mordor Intelligence, the market is expected to reach USD 28.84 billion (around ₹2.4 Lakh Crore) in 2025, growing steadily at over 5% CAGR through 2030. The reasons for this amplified growth include: affordability, a growing organised resale market, and flexible financing.

Many people prefer low-cost two-wheelers for personal commute in India, especially the low or middle-income groups. However, buying a new bike can be expensive. Many turn to used bikes as an inexpensive alternative. This creates the need for financing a used bike, which allows buyers to own a two-wheeler affordably and repay the cost gradually through flexible EMIs.

Benefits of Finance for a used bike

Banks and lending institutions offer finance for a used bike to consumers looking to purchase a used two-wheeler in India. These financing tools provide flexibility and affordability to consumers. Some of the key benefits associated with loans provided for a used bike include: 

• Affordability: Through finance for a used bike, you can spread your EMIs as per your convenience and affordability. For example, an individual comfortable with a ₹10,000 monthly EMI can choose suitable tenures across different financing options for a used bike. 
• Lower loan amount: The amounts for loans on used bikes are lower than those for new bikes. This is due to the underlying differential in price.
• Wide accessibility: This loan is available to salaried and self-employed individuals, helping more buyers own a bike affordably.
• Faster approval: Smaller loan amounts and fewer eligibility constraints often mean faster loan disbursal.
• Flexible repayment: Lenders offer customisable tenures, easing monthly budget pressure.

Eligibility Criteria for Used Bike Finance

Typically, the eligibility criteria for financing a used bike include:

• Citizen of India: The borrower must be an Indian citizen.
• Age bracket: Usually, a borrower in the 21-65 age bracket is accepted.
• Minimum monthly income: Many lenders have different minimum monthly income criteria, typically, ₹10,000 per month.
• Credit scores: Ideally, a good credit score and history are desirable. However, in most cases, a moderate score may suffice.

Factors that Impact Your Loan Approval

Key factors considered for approval of a loan for a used bike include:

• Age of the bike: Typically, bikes under 5 to 7 years old are preferred to ensure reliability and resale value.
• Service history: A well-documented, regular service record reassures lenders of proper maintenance.
• Accident and repair history: Bikes with no serious accidents or major repairs get better approvals. Transparency about repairs is important.
• Bike brand and model: Established brands/models with high resale value get quicker approvals and sometimes lower rates.

Step-by-Step Guide to the Application Process

You can apply for a loan for a used bike by following the steps listed below:

1. Check multiple lenders: Check who can offer the lowest bike loan interest rates and compare across multiple lenders who can offer flexible repayment options. Proceed with the one that aligns with your convenience.
2. Ensure your eligibility: The eligibility criteria must be checked across lenders.
3. Physical visit/online: You can visit the chosen lender’s local branch or visit their online website/app for an online loan application. 
4. Fill the application form: Either online or offline, you must accurately fill out the loan application form with personal and bike-related information.
5. Supportive documents: You may have to submit supportive documents such as identity proof, address proof, bike registration papers, etc. For online applications, submit scanned copies of the same.
6. Approval: Upon successful verification, approval for the application is usually quick.
7. Disbursal of funds: Once approved, the loan amount is credited to the borrower’s account. 

Final Words

Finance for used bikes has become a crucial catalyst for affordable two-wheeler ownership in India. With non-banking financial companies (NBFCs) commanding 68.5% of the two-wheeler finance market, their loan portfolio surged to ₹1,12,751 crore by March 2025, growing at a robust 22% CAGR from FY21 to FY25, according to CareEdge Ratings. Supported by GST cuts and improving rural demand, NBFCs are expected to drive 18–19% growth in FY26. By enabling manageable EMI repayments, used bike financing helps millions access reliable mobility, fostering economic opportunities and social inclusion across urban and rural India.