0% Finance Car Deals

How 0% finance works

When a manufacturer offers 0% PCP or HP, they're using marketing budget to subsidise the interest. The finance company (typically the manufacturer's own finance arm — Dacia Finance, Toyota Financial Services, etc.) still charges interest internally. The manufacturer covers it as a cost of sale.

Manufacturers do this to shift stock — usually specific models that aren't selling fast enough at full margin, or to hit quarterly volume targets. March, June, September, and December (quarter ends) are when 0% deals are most common, because manufacturers push dealers to hit registration targets.

Current 0% and low-APR deals

These are the lowest APR deals from our database of 20 PCP representative examples. We found 3 deals at exactly 0% APR. Plus 7 deals at low single-digit APRs.

Is 0% finance really free?

The interest is genuinely zero. You pay exactly the OTR (On The Road) price of the car, spread over the PCP or HP term. No interest charges appear in the total amount payable. On that dimension, it's free borrowing.

But "free borrowing" is not the same as "cheapest way to get the car". Here's why:

• No discount for cash. Dealers can negotiate on price. A car listed at £22,000 on 0% PCP might sell for £19,500 to a cash buyer or someone with pre-approved finance. The dealer's margin on the 0% deal comes from holding the full sticker price.
• Model restrictions. 0% is rarely available across a manufacturer's entire range. It's usually on specific trims or models with slow stock turnover.
• Term restrictions. Many 0% deals are limited to 24-36 months. Longer terms (48-60 months) revert to standard rates.
• Deposit requirements. Some 0% deals require a larger deposit than standard PCP terms.

When 0% isn't the cheapest option

Worked example. A manufacturer offers a car at £22,000 on 0% PCP over 36 months with a £7,000 balloon:

Option B is £1,302 cheaper despite paying 4.1% interest, because the starting price is lower. The 0% interest doesn't help if the car costs £2,500 more.

This doesn't always hold. Sometimes the cash discount is small or nonexistent. Sometimes 0% is genuinely the best deal. The point is: always ask for the cash price, then compare.

Typical restrictions on 0% deals

• New cars only. No manufacturer subsidises 0% on used stock.
• Specific models. Slow sellers or end-of-line models. The popular cars don't need a finance incentive.
• Limited terms. 24-36 months is typical. Longer terms increase the manufacturer's subsidy cost.
• Higher deposits. Some deals require 20-30% deposit to reduce the manufacturer's interest burden.
• Strict credit requirements. Score 750+ in most cases. The manufacturer only subsidises low-risk applicants.
• Seasonal availability. Quarter-end months (March, June, September, December) are the peak. Mid-quarter availability varies.

Where to find 0% deals

1. Manufacturer websites. Every major manufacturer publishes current offers on their UK site. Search "[brand] 0% finance UK".
2. Carwow. Aggregates dealer offers and displays the representative example. Our data comes from Carwow.
3. Dealer visits. Quarter-end deals are sometimes in-showroom only, not published online.
4. This page. We update whenever our scraper finds new 0% or near-0% representative examples.