The majority of us now finance or lease our new cars, as it means you can affordably spread the cost of ownership over several years, rather than having to pay for it all in one go.
It can be a really affordable way of getting behind the wheel of a new car – not least with Fiat’s innovative new ‘Pay As You Go’ finance programme that’s now available on its latest 500 Hybrid.
Here’s everything you need to know about it…
How does it work?
With a regular finance or leasing agreement, you usually have to specify the number of miles you cover per year beforehand. You’ll then be charged per mile for any additional mileage you do over that limit.
However, with Pay As You Go, you just pay for the miles you’ve travelled. Fiat installs a telematics box in the car to track the number of miles you’ve covered, and then gives you a bill at the end of each based on the number of miles. You also pay a small fixed sum each month, just to cover the cost of depreciation on Fiat’s part.
What does it cost?
Fiat’s scheme is undoubtedly one of the most affordable finance offers around – particularly if you don’t cover a huge number of miles.
For starters, all you have to do to take out an agreement is to make an initial fee of £99, and you’ll then pay this amount over the next 47 months as a minimum.
After this, the telematics box will calculate how many miles you’ve covered, and will charge you just 19.2p per mile, including VAT. It means that if you have a 10-mile commute each day, it could cost you as little as £2 per day.
Fiat has also calculated that including the monthly payment and fuel, a commuter doing 25 miles each day would pay £10.39 per day, which is less than the average London commuter pays out.
Fiat is also giving motorists the first 500 miles at no extra cost, which equates to £96 of free miles.
What cars is it available on?
Initially the Pay As You Go scheme is just available on Fiat’s new 500 Hybrid, which sees an electrified mild-hybrid powertrain being introduced to the firm’s chic city car.
If you’re hoping to keep your running costs down, the mild hybrid is a great choice, as it returns a claimed 53.3mpg with CO2 emissions of 119g/km, while also being cheap to insure.
Fiat says it’s hoping to expand this new finance offer across both its own models, as well as other FCA brands, such as Abarth, Alfa Romeo and Jeep.
What’s the benefit?
A key benefit of Pay As You Go is that you won’t be penalised for doing more miles than your contract states – something that usual leasing and PCP agreements do. There are also no upper mileage limits, either.
With normal finance agreements, you might be left out of pocket if you don’t cover as many miles as your contract allows for, too, whereas with this you’ll only have to pay for the number of miles you use.
While this way of financing might not work out as better value than other types of leasing if you cover a lot of miles each year, if you have a short commute and only rack up 5,000 or so miles a year, it could work out as being far more affordable.
Enquire on a new Fiat
