Drive home a Nano for just Rs 25,000 to Rs 30,000. This is the amount that a Nano buyer has to pay as a downpayment for the car. The rest (around 70% of the total cost of the car) would be financed by the State Bank of India.

According to sources, the largest nationalised bank in the country is planning to finance the vehicle at higher rate of interest (14% to 14.5% for tenure of up to five years) as against the prevailing rates of 11% to 12% to cash on the demand.

?Less than a week is still left for Nano to go on roads and another 15 days before the booking of the vehicle starts. As such we have still not firmed up a product for financing the vehicle,? says an SBI official without divulging details. Even Tata Motors? spokesperson refused to comment saying that the company will comprehensively answer all queries on the day of launch of Nano that is March 23.

However, sources says the bank will come up with more stringent norms and demand higher downpayment for Nano considering that the vehicle will generate robust demand. Tata Motors have already received around 40 million queries on the Nano on its websites so far.

?The ultra low cost car will attract thousands of people and once the production starts in full swing in Gujarat towards the end of the year there is a probability that there would be higher number of payment defaults. As such the bank is working on a new model that might include higher down payment and higher rate of interest format to keep the default rates under control,? says an official at SBI. SBI currently offers loan of up to 85% of the total vehicle cost.

While there is no clear indication from the company about the allotment of the vehicle, a Delhi-based dealer says that the company will fix the number of vehicles per state and per dealer, as the initial numbers are very low, to meet the demand across different parts of the country.

The entry-level model of Tata Nano will cost Rs 1 lakh (excluding freight and value-added tax) and the top-end model with air conditioner is expected to be costlier by Rs 25,000 to Rs 30,000.