Mahindra Auto Financing

Many individuals have a dream to own a vehicle, mostly a car. Few of them have enough

financial support and are able to buy the vehicle they desire and few of them don’t have

enough money to buy there desired vehicle. These individuals are financially less stronger and

may not be able to pay the total amount at a time but are able to pay over a period of time.

For such individuals, Auto Financing is a door-way for there dream to come true.

Auto Financing is a process in which an individual in need of a vehicle but do-not have

enough money to pay the dealer gets financial assistance in form of a loan. The lender may

be a Bank or a Finance Company. Loan is approved only if the customer accepts the terms

and conditions of the organisation & completes the required documentation process. After the

approval of the loan, the customer can pay the dealer required money & buy the vehicle and

is supposed to repay the borrowed amount in instalments from minimum of 12 to maximum of

60 months. There are two types of lending direct lending and dealership lending. In direct

lending the customer is in direct contact with the bank or finance company by means of which

he can pay the dealer for the desired vehicle. Before approving the loan, the organisation

checks the ability of the customer to repay the loan. Until the last instalment is payed by the

customer, the authority of the vehicle is withheld by the organisation. In dealership lending, the

customer gets financial aid from the dealer. In this case the customer is supposed to pay 10%

of the total price of the vehicle and agrees to pay the remaining amount in instalments over

a period of time as per the terms and conditions of the company. In dealership lending either

the dealer keeps the customer account to themselves or sells to a bank or a finance company

which will be responsible for collecting the monthly instalments from the customer. In one angle

dealership lending is more advantageous because it has different options to choose the financial

assistance from.
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In Auto Financing one should be very careful of which finance company he/she is seeking

assistance from and it is always suggested to do a good market research before choosing

one. There are some financial companies irrespective of the ability of the customer to repay

the loan, they approve loans. In this case one should be very careful of terms and conditions

of the company and considering what security they are approving the loan.

In Auto Finance Market one of the firms which is two decades old, yet trust worthy and

easy to reach is Mahindra Finance. Mahindra Finance is spread all over India and is located

in semi-urban and rural areas, thus it is easy to reach. Over two decades of time, it has

increased it’s goodwill in the society through different schemes and marketing strategies and is

serving it’s customers without differentiating there cast, sex, race and place of birth & providing

the best services possible and thus it is trust worthy. Mahindra Finance is providing Vehicle

loans, Home loans and personal loans to it’s customers subjected to the terms and conditions.

The sanction of Auto loans at Mahindra Finance is a very convenient to the customer such

that if all the required documents are provided by the customer, the loan is approved on the

same day itself with a reasonable rate of interest based on the financial situation of the

customer & the loan sanctioned after which the customer can go home happily with his new

vehicle.

Mahindra Auto Finance is basically a customer oriented company. The financial strength of

urban people is stronger than compared to semi-urban and rural India, thus for the sake of

customer convenience it have spread its wings all over the country in semi-urban and rural

areas of India & made it easy for the customer in need to approach in turn which helped it

to win the hearts of the people and boasting its market capture. It has given the customers

the leverage of deciding the repayment period of approved loan from minimum of twelve months
 Mahindra Auto Financing

to maximum of sixty months which provides the customer with vast variety of repayment options

thus giving strength and support to those individuals who are not able to pay for there dream

vehicle at once and helping in achieving there dream by providing financial assistance which

they can return back by means of instalments with a reasonable interest in agreed period of

time. So by being a customer centred company, it is filling the lives of there customers with

light and happiness and therefore in this way it is winning the hearts of there customers and

creating its goodwill in the market.

There are other finance companies and banks which are into Auto Financing industry trying

to capture the same market that of Mahindra Finance popularly known as competitors. The

competition between any two organisations occurs because there end goals and targets are

similar and in some cases exactly same. The main competitors of Mahindra Finance are Tata

Capital, Axis Bank, HDFC Bank, Bajaj Finance, Fullerton India.

By creating the desire to buy a vehicle in the minds of the customer, we can see the

growth in the industry. If an individual is choosing to buy a vehicle even though he/she is able

to pay the required amount at once, it is a benefit for that customer. In this case instead of

solidifying a lumpsum amount in one thing, they are can pay it over a period of time and the

liquidity of cash is uninterrupted i.e., they can invest that amount in a maximum profit giving

sector through which they can gain profits from the available money in there hands. If these

thoughts are realised and positioned in the minds of the customers, the Finance industry will

tend to have a positive growth and will be able to capture a larger market. Maintaining a good

business relationship with the existing customer encourages them to give a positive feedback

in there family, friend circle and neighbourhood creates our brand name in the market and help

the organisation in reaching out to more people who may become our customers very soon.
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There are also few factors that are affecting the growth of the Auto Financing industry. If

a company has a high interest rates without considering the outside market, it may result in

the decrease of its customer satisfaction ultimately resulting in reduction of its own revenue.

The economy of the country has an overall affect on individuals and all the firms in the country

i.e., if the economy of the country increases, it will result in increased revenue and vice versa.

If the rate of repayment by the existing customers is not regular, it may result in interruption

in cash flow which may result in procrastination of new loan approvals.

As per my opinion, Auto Financing is a very easy means through which an individual can

get his/her dream vehicle by paying a minimum amount over an agreed period of time. Auto

Financing results in regulation & increased production of vehicles depending on the demand

from the customers. As long as Auto Financing industry is satisfying customer needs and

customer centred, there is growth in demand and supply.