Tata Motors is exploring the possibility of providing loans for the Nano either through Tata Motors Finance (TMFL) or existing financing channels.

This goes against the industry practice where hire-purchase (financed) deals are signed by dealers and not by manufacturers.

Tata Motors has initiated discussions with leading vehicle loan providers in the country.

The group's priority is to provide financial support through TMFL. The company is also talking to ICICI Bank, State Bank of India and HDFC Bank.

Betting on a huge demand for the Nano, profits will be volume-driven. In turn, the profit-margin on the car will be lower than existing cars.