TEHRAN, Aug. 29 (Xinhua) -- The Iranian authorities issued on Tuesday a mandate that requires automakers to reduce interest rates offered on pre-sale contracts, Financial Tribune daily reported.
The Central Bank of Iran (CBI) and the Ministry of Industry, Mines and Trade have jointly issued a mandate that requires automakers to reduce interest rates offered on pre-sale contracts, the report said.
In order to attract short-term investment, most Iranian automakers offer a high interest rate on customers' down payment prior to receiving their car.
In a nutshell, the scheme acts as an incentive for buyers to receive a small discount on their new car.
According to the new rule, interest offered by automakers will be cut to 18 percent from 25 percent, the report said.
The pre-sale cars are normally delivered in three to 12 months. However, the automakers have a history of not delivering vehicles on time, according to the daily.
Besides, not all who sign up for a pre-sale contract are "real" car buyers. Many customers cancel the deal few days before the car is delivered and the carmaker returns their down payment with a small dividend.
The new mandate will come into force in January 2018 and is designed to distance investments away from the local dysfunctional auto manufacturing and assembling into Small and Medium Enterprises. Enditem
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