Poonawalla Fincorp Expands into CV Secured Loan Business

Key Highlights:

• Poonawalla Fincorp has launched a CV Loan service, covering small, light, intermediate, and heavy vehicles.
• The company plans to start operations in 68 locations across 12 states.
• Loans will be available through direct channels, dealers, and partners.
• The used commercial vehicle segment is expected to make up a significant part of PFL's loan portfolio.
• NBFCs lead the commercial vehicle financing market, with banks offering loans to a lesser extent.

Poonawalla Fincorp Limited (PFL) has started offering loans for commercial vehicles, expanding its product portfolio into the transportation financing sector. Poonawalla Fincorp Limited is a non-banking finance company promoted by the Cyrus Poonawalla Group. With this new service, PFL will provide loans for Small, Light, Intermediate, and Heavy Commercial Vehicles from all major brands, including both new and used ones. 

Experts say that India's growing e-commerce, industrial expansion, and infrastructure projects have increased the demand for commercial vehicles. A large part of Poonawalla Fincorp’s loans in this segment is expected to be for used vehicles.

Planned Expansion and Availability of Loans

In the first phase, Poonawalla Fincorp will start operations in 68 locations across 12 states. Later, it plans to expand to 400 locations in 20 states using a hub-and-spoke model. The loans will be available through direct customers, dealers, and other partners. The company has also introduced a tech system to make the loan process faster and easier by reducing paperwork and approval time.

Arvind Kapil, Managing Director & CEO of Poonawalla Fincorp, said that the commercial transport sector is vital for the economy. He added that their new loan service will help transporters with easy processes and minimal paperwork.

About Poonawalla Fincorp Limited

Based in Pune, Poonawalla Fincorp has been in business for nearly 30 years and is listed on both the BSE and NSE. As of December 31, 2024, the company had ₹30,984 crore in assets under management (AUM) and employed over 2,560 people across 18 states and 2 Union Territories. Poonawalla Fincorp’s current financial products include pre-owned car finance, personal loans, consumer loans, business loans, loans against property, and machinery loans. The new commercial vehicle financing service fits with the company’s focus on secured lending.

Market Trends in Commercial Vehicle Financing

Non-Banking Financial Companies (NBFCs) hold more than 60% of the market share in commercial vehicle financing, with major players like Mahindra & Mahindra Financial Services, Tata Motors Finance, Shriram Transport Finance, L&T Finance, Indostar Capital Finance, Sundaram Finance, Cholamandalam Investment and Finance, and MAS Financial Services leading the way.

Banks like State Bank of India, ICICI Bank, and Axis Bank also offer commercial vehicle financing, though on a smaller scale. New trends in the segment include financing for electric vehicles (EVs), digital loan processes to improve efficiency, and customized solutions for small businesses. Regulatory changes, such as BS VI norms, also impact vehicle purchases and financing patterns.

Also Read: Jupiter Electric Mobility Aims for 1 Lakh EVs in Five Years with focus on LCV market

CMV360 Says

In India, the commercial vehicle financing segment plays a key role in helping people buy trucks, buses, and other vehicles that are essential for transportation and logistics. Poonawalla Fincorp’s move into commercial vehicle loans is a good decision. With more demand for vehicles in industries like e-commerce and logistics, this service will help many small business owners and transporters get the vehicles they need. The easy loan process and the focus on both new and used vehicles make it more accessible.