Buying a car without paying a single rupee upfront might sound impossible, but in 2025, zero down payment car loans in India are making it a reality. These loans allow you to take home your favorite car without paying any advance amount. Instead, the entire cost is financed by the bank or lender, and you repay in monthly EMIs.
If you’ve been delaying your car purchase because of the heavy down payment, this guide will explain how zero down payment car loans work, eligibility, interest rates, application steps, benefits, and risks so you can make the right choice.
Key Highlights
- No upfront cost – 100% financing for your car.
- Available for new and sometimes used cars.
- Flexible repayment tenure from 1 to 7 years.
- Higher EMIs compared to regular car loans.
- Best for buyers with strong credit score and stable income.
What is a Zero Down Payment Car Loan?
A zero down payment car loan is a financing option where the bank pays the full cost of your car, including ex-showroom price, registration, and insurance. You don’t have to arrange any advance money. The total amount is added to your loan, which you repay in monthly installments.
This is different from regular car loans, where banks usually finance only 80–90% of the car’s price and you pay the rest upfront.
Benefits of Zero Down Payment Car Loans
- Instant Purchase – No need to wait to save for a down payment.
- Full Cost Coverage – Loan includes on-road price, RTO charges, and insurance.
- Flexible EMI Plans – Choose repayment tenure as per your budget.
- Easy Application – Most banks offer online application and quick approval.
Drawbacks to Consider
- Higher Interest Outgo – Since you borrow more, the total interest paid is higher.
- Strict Eligibility – Lenders approve only if you have strong repayment capacity.
- Higher EMIs – Monthly payments are more compared to a normal car loan.
Eligibility Criteria for Zero Down Payment Car Loan in 2025
| Eligibility Factor | Requirement |
|---|---|
| Age | 21 to 65 years |
| Income | Minimum ₹20,000–₹25,000 monthly (varies by bank) |
| Employment | Salaried or self-employed with stable income |
| Credit Score | 750+ preferred |
| Car Type | New cars (some banks allow select used cars) |
Documents Required
- Identity Proof – Aadhaar, Passport, Voter ID, Driving License
- Address Proof – Aadhaar, Utility Bill, Ration Card
- Income Proof – Salary slips (last 3 months), bank statements (last 6 months), ITR for self-employed
- Car Details – Quotation from dealership
How to Apply for Zero Down Payment Car Loan in India 2025
- Check Your Credit Score – Higher score improves approval chances.
- Compare Bank Offers – Look at interest rates, tenure, processing fees.
- Choose Your Car – Get a price quotation from an authorised dealer.
- Apply Online or Offline – Fill application form with KYC and income details.
- Loan Approval & Disbursement – Once approved, the bank pays the dealer directly.
- Drive Your Car Home – Start your EMIs as per schedule.
Top Banks & Lenders Offering Zero Down Payment Car Loans in 2025
| Bank / NBFC | Interest Rate (p.a.) | Tenure | Processing Fee |
|---|---|---|---|
| HDFC Bank | 8.50% – 10.50% | Up to 7 years | 0.5% – 1% |
| SBI | 8.70% – 9.80% | Up to 7 years | ₹2,000 – ₹5,000 |
| ICICI Bank | 8.75% – 10.25% | Up to 7 years | 0.5% of loan |
| Axis Bank | 8.90% – 10.75% | Up to 7 years | 0.5% – 1% |
| Tata Capital | 9.00% – 12.00% | Up to 6 years | Variable |
(Rates are indicative and may vary by profile and location.)
Tips to Get Approval Easily
- Maintain a credit score above 750.
- Show stable income and low existing debts.
- Opt for a shorter tenure if possible to reduce risk for the lender.
- Apply with a co-applicant to improve eligibility.
FAQs – Zero Down Payment Car Loans 2025
Q1. Can I get a zero down payment car loan with a low credit score?
A: It’s difficult. Most banks require a score of 750+, but some NBFCs may approve with higher interest rates.
Q2. Do these loans cover insurance and RTO charges?
A: Yes, most lenders include on-road costs like insurance, RTO, and accessories.
Q3. Are zero down payment loans available for used cars?
A: Yes, but only certain banks and only for select models in good condition.
Q4. How fast can I get the loan?
A: If documents are ready and profile is strong, you can get approval within 24–48 hours.
Final Word
A zero down payment car loan in India 2025 is a smart option if you want a car urgently but don’t have the funds for a down payment. Just remember, while it saves you from upfront costs, it increases your EMI burden. Compare offers, calculate your monthly budget, and choose a plan that suits your income before signing the deal.