According to a report on Livemint, the loan to purchase the world’s cheapest car is going to cost more to the buyers. Due to its 1 lakh price tag, a buyer would be treated as a buyer of a second-hand car, While financing the Tata Nano.

Several lenders are expecting that typical loan applicants for the Nano could be people with lower incomes. The customer risk profile of such applicants is considered to be associated with higher risks. Because of this risk factor, the lenders would plan to get more from buyers.

It is very likely that the Nano loan applicants may have to pay annual interest between 17% and 18%. Usually, for brand new cars, financial institutions currently charge around 14.5%.

Source: LiveMint