OTO Capital, a vehicle leasing startup, has reported a surge in partnerships with automotive dealers in Bengaluru. The firm says that more than 110 automotive dealers in the city have signed up with OTO Capital for vehicle leasing as an alternative model of financing to their customers. Since the national lockdown restrictions have been eased, demand from consumers has increased, with 28-30% of auto buyers enquiring about leasing options instead of vehicle loans.
OTO is witnessing more than 120% increase in applications for leasing two-wheelers from dealers compared to February this year. OTO Capital has received over 5000 applications for low and mid-range models, while high-end models and niche brands have not seen similar numbers in the past three months. In the month of June alone, more than 120 two-wheelers have been leased through OTO in Bengaluru.
The recent BS-VI norms have pushed the cost of buying vehicles during an industry-wide slowdown. Dealerships have reported that in recent weeks, consumer demand has started gearing up slowly but buyers are leaning towards affordable models, especially in the two-wheeler market.
There has been a surge in demand for scooters and early entrant bikes priced below Rs 1 lakh. Customers are also looking for alternative finance options other than vehicle loans to make their auto purchases.
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OTO features the My OMI Plan leasing option for customers to purchase two-wheelers of their choice at any dealer showroom. Under the plan, customers pay a low down payment of as little as Rs 5000 which is refundable and OMIs (Ownership Monthly Installments) that are 30% less than existing two-wheeler loan EMIs.
Customers can choose the tenure of their OMIs, which ranges from one-three years. At the end of the chosen tenure, customers have the flexibility to walk away with no obligation, or upgrade to another brand-new vehicle, or make a simple balloon payment to retain the same vehicle. Buyers also get a convenient, all-inclusive OMI that includes bumper to bumper insurance and maintenance.
