Personal Loan vs. Bike loan

Are you planning to buy a bike but wondering which is the best option between personal loans and bike finance to fund the same?

Today, there are varieties of loans available to meet different kinds of needs such as home loans, auto loans, education loans, etc. 

But personal loans are unique as they can be used for a variety of reasons, including purchasing a bike or two-wheeler.

In such a scenario, which is the better option - Personal loans or bike finance? 

Personal Loan vs. Bike Loan - Which One Should You Choose?

Let us understand the features of each of these loans first, in order to find out which one is the better option.

Features of a Personal Loan

A personal loan is an unsecured short term loan that can be availed by an individual from different lenders like banks, NBFCs, or online fintech lenders. 

The eligibility criteria and documentation requirements for availing a personal loan are less stringent compared to other loans such as home loans and education loans.

Personal loans do not require security or collateral making them easy to avail. However, interest rates may be on the higher side due to this factor.

Features of a Bike Loan

A bike loan or a two-wheeler loan, on the other hand, is a secured loan. This loan can be availed only against the security of a two-wheeler. 

The asset (bike/two-wheeler) remains hypothecated with the lender until the loan is repaid in full.

Earlier, tenures of bike loans were the same as personal loans, however, these days extended tenures are becoming more common. 

The loan amount that can be availed is higher as compared to personal loan but the eligibility conditions for a bike loan or bike finance are generally more stringent.

Personal Loan vs. Bike Loan - At a Glance

Based on the features mentioned above, let us compare the two loans -


Personal Loan

Bike Loan


Can be used for anything as long as it is legal

Only for purchase of a two-wheeler/bike/scooter

Loan Amount

(varies based on the lender)

Anywhere between Rs 5,000 to Rs 5 lakh 

Restricted to the price of the bike

Down Payment/Collateral

No down payment/collateral/security required

Down payment of 10-20% of the on-road cost of the two-wheeler may be required

The bike in question will be considered as collateral

Interest Rate (varies based on the lender)

Starts at 16% p.a.

From 9.55% onwards p.a.

Tenure of the loan

Generally up to 5 years

Extended tenure of 7 years allowed

Eligibility Criteria

Comparatively relaxed

Comparatively stricter

Documentation Requirements


May require more documents


Banks, NBFCs or online lenders

Only from Banks or NBFCs

Time and Ease of disbursal

Very easy when a personal loan is availed from an online lender. Approval and disbursal in shorter amounts of time

Longer duration for disbursal. May require coordination between the dealer and the lender.

Ownership of the bike purchased

With the buyer always

Bike ownership remains with the lender until the loan is repaid in full.

Which is the Best Option between a Personal Loan and Bike Finance?

Based on the table above, we can see that both loans have their own advantages and disadvantages. While personal loans are easier to avail, the interest rates may be on the higher side as compared to bike loans.

Bike loans come with longer repayment terms but if you miss your repayments, the bike may remain in possession of the lender.

As for the best option between the two - it completely depends on your financial situation. 

For eg. If you require an urgent loan to purchase a bike with minimal documentation, then a personal loan will be a better option. 

But if you require a longer repayment term and are comfortable with providing collateral (the bike in question), then a bike loan may be the right choice for you.

Have an idea of your financial situation and your goals and go for the right type of loan based on that.

How can an Online Personal Loan from Money View Help You Buy a Two-Wheeler?

As you can see from the comparison above, a personal loan is a great option to fund your bike purchase and in many ways, even more advantageous than a bike loan.

And a personal loan from one of the top lenders in the country, Money View, is an even better option. Here’s why :

Availing a personal loan from Money View is a completely online process and you can apply from the comfort of your home/office.

Bike loans can take some days for disbursal even if all your documents are in order. On the other hand, a personal loan from Money View can be disbursed in a matter of 24 hours from the time of approval.

When you avail of a personal loan to purchase a two-wheeler from Money View, you need not submit any proof of purchase or hypothecate your bike with us. So, the bike/two-wheeler is in your name from Day 1.

Unlike most other lenders, at Money View, we only require three of your documentations - Identity Proof, Address Proof, and Income Proof.

Interest rates for Money View personal loans start at 1.33% per month and will depend on your credit score.

At Money View, we use a unique credit rating model which is why, as long as your CIBIL score is above 600 or your Experian score is above 650, you can still avail a personal loan from us.

Now that you’ve found out your eligibility and the documents required, follow the steps below to apply -

Check your eligibility

Visit the Money View website or loan app. Provide the required details and we will let you know your eligibility in 2 minutes.

Choose your loan plan

Based on the options provided, select the loan amount and repayment term of your choice

Upload required documents

Upload all of the necessary documents online for verification

Loan transfer to your bank account

Post verification and submission of loan agreement, the loan amount will be credited to your account within 24 hours

Note -

  • After your documents are verified, you will receive a NACH form which needs to be printed, signed, scanned, and sent back to Money View.
  • This step will enable the auto-debit facility from your bank account and allow you to pay your EMIs on time automatically without the need for any manual intervention.
  • On receiving your NACH form, you will need to review the loan agreement on the app. Please submit the application after reviewing all the terms and conditions thoroughly.

Personal Loan vs. Bike loan Related Faqs

Ans: The eligibility criteria that need to be fulfilled are -

  • Applicants must be between 21 years and 57 years

  • Applicants must receive a monthly income of Rs. 13,500 or more

  • Income must be credited directly to the applicants’ bank account

  • Credit score must be a minimum CIBIL score of 600 or minimum Experian score of 650

    Given below is a city-wise breakdown of the income and credit score requirement -

    Income and Credit Score Eligibility Criteria*

    Salaried Individuals

    Minimum In-Hand Income

    Area of Residence

    CIBIL Credit Score Requirement

    Rs 13,500


    CIBIL Score of 600 /Experian Score of 650 and above

    Rs 20,000

    Mumbai/Thane or the NCR region (Delhi, Noida, Gurgaon, Ghaziabad, Faridabad, etc.)

    New to Credit or

    CIBIL Score of 600 /Experian Score of 650 and above

    Rs 15,000

    Metro City other than Mumbai and NCR

    CIBIL Score of 600 /Experian Score of 650 and above

    Self-Employed Individuals

    Rs. 15,000


    CIBIL Score of 600 /Experian Score of 650 and above

Ans: Take a look at our advantageous fees and charges below -

Fees and Charges

Amount Chargeable

Interest Rate

Starting from 1.33% per month

Loan Processing Charges

Between 2% to 8% of the approved loan amount

Interest on Overdue EMIs

2% per month on the overdue EMI/Principal loan amount

Cheque Bounce

Rs.500/- each time

Loan Cancellation

  • No additional charges levied

  • The interest amount for the period between loan disbursement and loan cancellation will be payable.

  • Processing fees will also be retained.

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