Updated: 4 October 2026

Cholamandalam Investment and Finance Company (Chola) finances new and used tractors and refinances tractors already owned, and also lends for harvesters, trolleys, rotavators and power tillers. It publishes a fixed-rate band for tractor loans, 12% to 28% a year on a new tractor and 17% to 28% on a used one, not a single rate. The rate for one borrower is set case by case and appears in the sanction letter.

The figures below come from Chola's Lending Rate Model and Charges document of December 2025 and its Tractor and Farm Equipment Loans page. Land holding, margin, maximum loan and tenure are not published in either.

Product and who it is for

  • Name: Tractor and Farm Equipment Loans (listed as "Tractor / Tractor FE" in the rate document).
  • Covers: finance for new tractors, finance for used tractors, and refinance on a tractor the borrower already owns.
  • Farm equipment: harvesters, trolleys, rotavators, power tillers and similar machines.
  • Insurance: the page lists "Insurance for Tractor, Self and Family" as a feature.

Interest rate

Tractor loan (fixed rate)Published range per year
New tractor12% to 28%
Used tractor17% to 28%

This is the "indicative lending rate range" in Annexure 1 of the December 2025 document. Chola says the rate is decided case by case on borrower, asset and loan factors. The asset factors include the make and model and the age of the asset. The loan factors include loan-to-value ratio and tenure. Interest can be charged on monthly, quarterly or half-yearly rests, or on maturity, depending on the product and the borrower's choice. The sanction letter must state the annualised rate, and the Key Facts Statement carries the Annualised Percentage Rate.

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Eligibility, margin and security

Minimum land holding, age limit, repayment record, down payment, maximum finance and security are not stated on the product page or in the rate document. The page claims "Instant Approval" and "Minimum Documentation" without giving conditions.

Tenure and repayment

The tenure is not published. The page says only "Flexible repayment based on Crop Patterns", and no schedule such as half-yearly with harvest is described. No moratorium is mentioned. The FAQ names the repayment modes used on Chola loans:

  • RPDC (Roll Over Post Dated Cheque): 12 post dated cheques for each financial year, renewed every year until the last instalment.
  • NPDC (Non Post Dated Cheque): instalments paid in cash at a branch or to Chola's authorised collection agency or executive, with a receipt every time. Switching from RPDC to NPDC needs 4 security cheques.
  • Payment by credit card is not accepted.

Fees and charges

ChargePublished amount
Admin and processing fee, new tractor0.25% to 2% of loan amount
Admin and processing fee, used tractor0.75% to 3.25% of loan amount
Sourcing fee (includes documentation charges)₹1,000 to ₹2,500
Late payment (penal charges)30% per annum on the overdue amount, from the due date to the date of payment
Cheque or mandate bounce₹500 per bounce
Cheque or mandate swap₹1,000 plus GST
Collection effort (field visit)₹200 plus GST
Statement of account, physical copy₹250 plus GST
Duplicate NOC₹500 plus GST (the FAQ says ₹500 in cash at a branch)
Stamp dutyAs per state guidelines

The charges table is the one given for vehicle finance in Annexure 2, with a separate row for tractors on the processing fee. Legal and recovery charges are billed at actuals.

Prepayment and foreclosure

  • Full closure from 7 to 12 months after the date of the agreement: 5% of the principal outstanding, plus GST.
  • Full closure after 12 months: 4% of the principal outstanding, plus GST.
  • The FAQ confirms a loan can be repaid before the end of the tenure, and that prepayment charges depend on the loan type and the kind of closure. Charges for part payment and for closure within the first 6 months are not shown in the table.
  • After closure the NOC is issued once the last payment has cleared and no other loan exists on the same vehicle. Unused cheques are returned with it, and Chola destroys cheques not collected within 60 days.

Used tractor and refinance

Used tractor loans carry the higher bands above: a rate floor of 17% instead of 12%, and a processing fee of 0.75% to 3.25% instead of 0.25% to 2%. Age and condition limits for a used tractor, and refinance terms, are not published.

Documents

The application documents are not listed on the page. After disbursal the borrower hands over the Registration Certificate (RC), a copy of the insurance policy and the invoice endorsed in favour of Chola, as applicable to a new purchase, a used purchase or a refinance. The branch salesperson collects them.

How to apply and contact

  • Use "Apply Loan" or "Get a Call Back" on the Chola tractor loan page, after which an executive calls. The page says the executive visits the borrower and completes the requirements digitally.
  • Walk into the nearest branch. Chola states more than 1,000 branches.
  • Toll free: 1800 102 4565 or 1800 123 4565. Email: [email protected].

What to check before signing

  • Ask for the Key Facts Statement and read the annualised rate, not only the quoted rate. Ask whether the rate is flat or reducing balance, and whether it is fixed for the whole tenure.
  • Ask whether insurance is added to the loan amount, and what the cover is.
  • Add up the processing fee, sourcing fee and stamp duty, and ask which are deducted from the loan.
  • Ask for the foreclosure terms in writing, including part payment.
  • Check the instalment dates against when the crop is sold. Late payment is charged at 30% a year.

Compare the monthly cost with the EMI calculator, work out the price with the on-road price tool, and read the tractor loan overview. Check tractor subsidy before booking. See tractors, tractor dealers and the Kisan Credit Card for working-capital credit.

Sources

Tractor loan by lender