Thanachart Bank (TBank) has set its sights on increasing used car financing by 30 per cent from last year to Bt23 billion, to cash in on higher interest rates than those offered for purchases of new vehicles.
Used car loans now account for 35 per cent of the bank's carloan portfolio.
TBank senior vice president Anuchart Deeprasert said the usedcar market was expected to recover in the second half of this year, thanks to higher agriculturalproduct prices, which would spark demand for multi purpose vehicles, mainly pickups.
The bank has launched a campaign for usedcar financing, offering an interest rate of 2.99 per cent per year. Borrowers can finance up to 100 per cent of the car's value.
TBank believes the campaign will boost the value of used car loans. It is expected to attract customers because the current interest rate for usedcar loans is 3.85 per cent on average.
Customers will enjoy the 2.99 per cent interest rate with a maximum instalment period of 48 months, he said.
The bank provided more than Bt10 billion in loans for used cars in the first half of this year, up by 10 per cent over the same period last year.
Meanwhile, Tisco Bank extended Bt3.86 billion in auto loans, up 30 per cent from the first quarter, partly because of its Tisco Auto Cash campaign. The campaign, launched in May, significantly boosted the loan extension by 52 per cent compared with the same period when there was no campaign.
Chalit Silpsrikul, executive vice president of Tisco Bank, said: "Customers like the campaign because of the lower interest rate of only 0.55 per cent per month with a maximum instalment period of 48 months. Customers will get cash after one day."