Banks and non-banking financial companies (NBFCs), once reluctant to finance electric commercial vehicles due to concerns around battery life, residual value and operational viability, are now increasingly opening up capital flows to the segment as improving economics and charging infrastructure strengthen confidence in the ecosystem, according to Rajesh Kaul, Vice President and Business Head – Trucks at Tata Motors.
Speaking at the FE Mobility event, Kaul said financing sentiment around electric trucks has changed significantly compared to the early years of EV adoption, when lenders were hesitant to underwrite assets amid uncertainty over operational performance and resale value.
“When I used to talk to NBFCs, big banks and financial institutions about EV funding, there were so many apprehensions,” Kaul said, adding that there are now “more funds available” for investments across the EV ecosystem as the market matures.
The improving confidence among financiers comes alongside a sharp reduction in payback periods for electric trucks. According to Kaul, the additional payback period for EV trucks compared with internal combustion engine vehicles has narrowed from around 2.5–3 years earlier to nearly 1.5–2 years now.
Policy Mandates
Echoing similar views, Anirudh Bhuwalka, Founder & MD, Blue Energy Motors said the ongoing West Asia crisis should be viewed as an opportunity to accelerate electrification of heavy-duty trucks in India and reduce dependence on imported fossil fuels.
Bhuwalka said the government should consider mandating 10–20% electric truck adoption for large corporations and logistics operators as part of the country’s broader decarbonisation push. He also stressed that financing and policy support remain critical for scaling deployment of electric trucks and charging infrastructure.
“The government should focus on helping deployment of electric trucks,” Bhuwalka said, while calling for stronger financial support mechanisms to accelerate adoption.
The comments come at a time when the Centre is targeting a rollout of a financing support scheme for private electric bus and truck operators by the end of the year, amid growing concerns over India’s fuel import dependence following the ongoing West Asia crisis.
The Ministry of Heavy Industries (MHI) is working with public and private sector banks, NBFCs and apex financial institutions to develop a financing architecture that could combine interest subvention with partial credit guarantees for private electric commercial vehicles.
Turning Logistics Idle Time
Kaul said customers are increasingly willing to absorb the higher upfront cost of electric trucks due to concerns around fuel price volatility, crude oil dependency and rising ESG commitments.
Tata Motors is also witnessing a “huge pipeline” building up across commercial EV segments as fleet operators evaluate electrification more seriously, particularly for fixed-route and controlled operations.
Kaul said the rapid expansion of charging infrastructure by startups, private operators and large corporations is further improving financier confidence. Charging infrastructure providers are planning hubs across major freight corridors, including Bengaluru-Chennai and the Manesar-Gurugram belt, with stations expected at intervals of 100–200 kilometres.
He added that logistics hubs and warehouse operators are increasingly integrating charging infrastructure into loading and unloading operations, allowing fleet operators to use idle parking time for fast charging.
“So instead of loading and unloading time becoming a liability, it becomes an asset to charging infrastructure,” Kaul said.
However, Kaul cautioned that long-distance electric trucking infrastructure still requires significant strengthening. He also noted that battery-swapping models for heavy commercial vehicles remain capital intensive and may require stronger policy support and government-backed frameworks to scale investments.
“Mobility systems are only as strong as the infrastructure,” Kaul said.