State Bank of India is going to be the only finance provider for Tata Nano, which is considered to be the world's cheapest car.
Market sources are pointing towards a deal between State Bank of India and Tata Motors whereby the former will be the sole loan provider to Nano buyers across the country. The reports claim that Nano dealers will only accept cheques issued from SBI for orders placed for Nano. Besides, consumers who want to buy the car without a loan will have to issue demand draft of SBI drawn in favour of Tata Motors.
Although both parties are on final stages of agreement, the formal announcement is estimated to be made just before the first Nano rolls out into the market.
Tata Nano is expected to roll out by the last quarter of this fiscal. The first cars would come from Tata plants in Pantnagar, Uttarakhand and Pune, Maharashtra.
Tata Nano is being called the people's car of India and SBI is the preferred bank of the common man in India. Therefore Tata Motors wants to utilize the vast network of SBI and its seven associate banks to finance a product that has to attract customers from rural India.
SBI and its seven associate banks have a combined network of 13,000 branches.
Tata Nano has already impacted the sales of entry level cars like the Maruti 800 in anticipation, and analysts expect the entry level market dynamics to change further post the Nano launch.