Indian automobile manufacturer Mahindra & Mahindra (M&M) has signed a contract with the Jammu & Kashmir (J&K) bank as a preferred financier for providing loans for cars and commercial vehicles.

Under the memorandum of understanding (MoU), customers of the manufacturer will be allowed to avail vehicle finance from any of the branches of the bank.

J&K Bank executive president Abdul Hamid Banday said the bank is expanding its operations in commercial and passenger vehicle financing.

"It has been making niche offerings to its customers and this arrangement with Mahindra & Mahindra will be one such special initiative," Banday said.

M&M Automotive Division chief sales and customer care officer Arun Malhotra said, "With highly competitive schemes for car loans and commercial vehicles, we are hopeful of a good response from our dealers and customers."

The agreement will allow both the firms to leverage each other's networks, which include over 250 dealer outlets of the automaker and 685 branches of the bank across India.