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Maruti announces new car financing venture

India's largest car maker, Maruti Udyog Ltd, announced on Monday it has tied up with eight private sector banks and financial services companies to offer car financing options to its customers.

The car company will offer financing under the umbrella of Maruti Finance, which includes tie-ups with ABN Amro Bank, HDFC Bank, ICICI Ltd, Kotak Mahindra, Standard Chartered Bank and Sundaram Finance, as well as existing car financing ventures Citicorp Maruti and Maruti Countrywide.

"Maruti Finance marks the coming together of the biggest players in the car finance business," Maruti's managing director, Jagdish Khattar, said in a statement.

"Combined with Maruti volumes and network dealership, this will enable Maruti Finance to offer superior service and competitive rates in the marketplace."

Maruti is a 50:50 joint venture between Japan's Suzuki Motor Corp and the Indian government.

Currently, 65 per cent of Maruti's car sales are financed by loans. The company now hopes to raise that percentage to 75 per cent in three years.

A company spokesman declined to say to what extent the new financing partnerships will increase car sales.

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