Motorcycle Loan Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Type (New Motorcycle, Used Motorcycle), By Provider (Banks, NBFCs, OEM, Others (Fintech Companies, etc.)), By Tenure (Less than 3 Years, 3 & More than 3 Years), By Percentage of Amount Sanctioned (Less than 50%, More than 50%), By Region, By Competition Forecast, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 149.24 Billion
CAGR (2026-2031)	9.38%
Fastest Growing Segment	New Motorcycle
Largest Market	Asia Pacific
Market Size (2031)	USD 255.57 Billion

Market Overview

The Global Motorcycle Loan Market will grow from USD 149.24 Billion in 2025 to USD 255.57 Billion by 2031 at a 9.38% CAGR. A motorcycle loan is a financial product offered by banking and non-banking institutions that enables individuals or businesses to purchase two-wheeled vehicles by borrowing capital, which is subsequently repaid with interest over a predetermined tenure. The primary drivers supporting the growth of this market include the rising cost of vehicle ownership, which necessitates credit access for middle-income consumers, and the accelerating pace of urbanization that drives demand for affordable, maneuverable personal transport. Additionally, the expansion of the gig economy has created a structural need for commercial two-wheelers in the logistics sector, further propelling the demand for acquisition financing distinct from temporary market trends.

However, the market faces a significant challenge in the form of elevated interest rates and tighter credit appraisal norms, which can dampen borrowing sentiment among price-sensitive customer segments. This financing activity is intrinsically linked to the volume of vehicle transactions in key regions. According to the Society of Indian Automobile Manufacturers, in 2025, domestic two-wheeler sales volumes reached 1.94 million units in November alone, registering a 21.2% increase over the previous year, a surge that directly strengthens the addressable base for lending institutions.

Key Market Drivers

The surge in electric motorcycle adoption and green financing initiatives is fundamentally reshaping the lending landscape, as financial institutions design specialized products to lower the barrier of entry for battery-powered vehicles. Lenders are increasingly collaborating with manufacturers to offer subvention schemes and lower interest rates, addressing the higher upfront costs associated with electric mobility while supporting global sustainability goals. This trend is exemplified by specialized fintech players aggressively expanding their portfolios to cater to this segment. According to Devdiscourse, December 2024, in the 'RevFin Gears Up for Massive Expansion in Electric Vehicle Financing' report, the company disclosed it has financed approximately 75,000 electric vehicles to date, with 25,000 units funded in 2024 alone, highlighting the rapid uptake of credit in the green mobility sector.

Simultaneously, the proliferation of digital lending platforms and fintech integration has streamlined the loan origination process, allowing for paperless approvals and alternative credit scoring that broadens access for underserved borrowers. These digital-first models are crucial for meeting the high volume demand in emerging economies, where traditional banking penetration may be low but smartphone usage is ubiquitous. This operational shift is driving significant capital allocation toward two-wheeler assets. According to Entrackr, February 2024, in the 'Two-wheeler EV finance platform OTO raises $10 Mn' article, OTO Capital reported that lending partners have committed over INR 800 crore for disbursement over the upcoming 12 months to support digital two-wheeler financing. Reflecting the broader health of this credit segment, according to Bajaj Finserv, October 2024, in the 'Q2 FY25 Investor Presentation', the company's two- and three-wheeler finance assets under management grew by 15% year-over-year to reach INR 18,960 crore.

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Key Market Challenges

Elevated interest rates and tighter credit appraisal norms operate as a critical bottleneck for the market by eroding consumer purchasing power and limiting market access. When borrowing costs increase, the resulting higher monthly installments make financing less attractive for middle-income and price-sensitive demographics, who form the core customer base. Concurrently, rigorous credit screening processes disqualify marginal borrowers who might otherwise be eligible under looser norms, effectively reducing the pool of approved loan applicants and dampening overall lending volumes.

This tightening of financial conditions directly hampers the transition of vehicle stocks from dealerships to end consumers, causing retail performance to lag behind wholesale inventory push. A clear indication of this friction is observed in recent industry data which highlights a slowdown in consumer offtake. According to the Federation of Automobile Dealers Associations, in 2025, two-wheeler retail sales registered a decline of 3% year-on-year to approximately 2.55 million units in November. This contraction at the retail level underscores that despite robust manufacturing output, the friction in financing availability and affordability is actively constraining growth at the point of sale.

Key Market Trends

The Rise of Specialized Lending for Pre-Owned Motorcycles is transforming the sector as escalating new vehicle costs steer price-sensitive consumers toward the secondary market. Lenders are professionalizing this historically fragmented segment by collaborating with organized re-commerce platforms to offer certified vehicles bundled with transparent financing options. This structural evolution addresses the liquidity crunch in the used vehicle segment and builds trust among lower-income borrowers who previously relied on high-cost informal credit. According to Indian Startup Times, August 2025, in the 'Vutto Raises $7M Series A' report, the used two-wheeler marketplace Vutto secured capital to scale its integrated financing model, having successfully facilitated credit-linked sales for 1,500 vehicles within its first year.

Concurrently, the Growth of Embedded Financing at Point-of-Sale is reshaping distribution strategies as financial institutions embed their credit systems directly into dealership networks to capture demand instantly. By expanding their physical presence at retail outlets, lenders can offer real-time approvals and seamless onboarding, significantly increasing conversion rates compared to traditional branch-banking models. This proximity to the customer is proving critical for sustaining volume growth in competitive markets. According to Bajaj Finance, January 2025, in the 'Q3 FY25 Investor Presentation', the company expanded its reach by adding approximately 8,900 new distribution points during the quarter, driving a 22% increase in new loans booked year-over-year.

Segmental Insights

The New Motorcycle segment currently stands as the fastest-growing category within the global motorcycle loan market, driven by increasing consumer demand for reliable personal mobility. Lenders favor financing new units as they offer stable collateral values and lower credit risks compared to pre-owned vehicles. This growth is further fueled by strategic alliances between manufacturers and financial institutions that provide accessible credit options for recent models. Additionally, the global transition toward energy-efficient electric two-wheelers encourages borrowers to secure loans for modern inventory, thereby sustaining the strong upward trajectory of this segment.

Regional Insights

The Asia Pacific region commands the leading share of the Global Motorcycle Loan Market, driven by the essential nature of two-wheelers in densely populated economies like India, China, and Indonesia. High urbanization rates and traffic congestion make motorcycles the preferred mode of affordable transport. Market expansion is further supported by improving financial inclusion and the strategic proliferation of Non-Banking Financial Companies (NBFCs). These institutions play a critical role in extending credit to underserved demographics. Consequently, the convergence of rising disposable incomes and accessible financing options solidifies the region's global market leadership.

Recent Developments

• In November 2024, the State Bank of India (SBI) entered into a partnership with Uber to offer tailored financial solutions to the platform's fleet partners. This collaboration focuses on providing accessible and affordable loans for the acquisition of vehicles, including two-wheelers used for moto services, to support the expansion of the transportation network. The initiative is designed to empower drivers by offering hassle-free loan disbursements and competitive interest rates, thereby facilitating entrepreneurship within the gig economy. This move by the country's largest lender underscores the growing importance of institutional credit in supporting the operational needs of ride-hailing services.
• In September 2024, Revfin Services joined forces with SUN Mobility to finance 15,000 electric vehicles, reinforcing its commitment to the sustainable mobility ecosystem. This strategic alliance involves the financing of two-wheelers and three-wheelers compatible with battery-swapping technology, specifically targeting the rapidly expanding last-mile delivery and fleet segments. By integrating financing capabilities with energy infrastructure solutions, the companies aim to lower the entry barriers for gig workers and fleet operators. The initiative is expected to drive significant adoption of electric mobility solutions, contributing to growth in the commercial motorcycle loan market.
• In February 2024, OTO Capital secured $10 million in a funding round led by GMO Venture Partners to strengthen its position in the digital two-wheeler financing sector. The company announced that the capital infusion would be utilized to expand its operational footprint to more than 30 cities and support the growing demand for electric vehicles. This investment aims to redefine the ownership experience by offering flexible financing plans and digital-first services. The move highlights the increasing investor confidence in alternative financing models that simplify the purchase and resale journey for motorcycle and scooter buyers in emerging markets.
• In January 2024, Octane Lending announced a strategic agreement with Kawasaki Motors Corp., U.S.A. to provide promotional financing solutions for creditworthy customers in the United States. This collaboration designated the fintech company’s in-house lender as a key partner for the manufacturer, enabling it to offer a full spectrum of credit options for motorcycles, all-terrain vehicles, and jet skis. The partnership was designed to streamline the buying process through a digital financing experience, allowing dealers to offer competitive terms and flexible rates to a broader base of consumers, thereby enhancing sales volume in the North American powersports market.

Key Market Players

• Bank of American Corporation
• Mitsubishi HC Capital UK PLC
• GM Financial Inc.
• JPMorgan Chase & Co.
• Toyota Financial Services
• Ally Financial Inc.
• Daimler Financial Services
• Capital One Financial Corporation
• Ford Motor Credit Company
• General Motors Financial Company, Inc

By Type	By Provider	By Tenure	By Percentage of Amount Sanctioned	By Region
New Motorcycle Used Motorcycle	Banks NBFCs OEM Others (Fintech Companies, etc.)	Less than 3 Years 3 & More than 3 Years	Less than 50% More than 50%	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Motorcycle Loan Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Motorcycle Loan Market, By Type:

• New Motorcycle
• Used Motorcycle

• Motorcycle Loan Market, By Provider:

• Banks
• NBFCs
• OEM
• Others (Fintech Companies, etc.)

• Motorcycle Loan Market, By Tenure:

• Less than 3 Years
• 3 & More than 3 Years

• Motorcycle Loan Market, By Percentage of Amount Sanctioned:

• Less than 50%
• More than 50%

• Motorcycle Loan Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE