Axis Bank offers personal loans from Rs. 50,000 to Rs. 15 lakh with minimal documentation and quick approval. With Axis Bank Personal Loan, you can fulfill your various personal needs as there is no restriction on the end- use. Along with this, you can repay the loan within a flexible tenure ranging from 12 to 60 months. Currently the interest rate on personal loans offered by Axis Bank starts at 11% p.a.
Table of Contents:
- Interest Rates
- Reducing Balance Interest vs Flat Interest Rate Calculation
- EMI Calculation Using Reducing Interest Rate
- EMI Calculation Using Flat Interest Rate
- Interest Rate Calculation
- Axis Bank Personal Loan Interest Rate Comparison
- How to Get Low Interest Rates on Axis Bank Personal Loan?
- Factors Affecting Interest Rates
- FAQs
Axis Bank Personal Loan Interest Rate
The interest rate on Axis Bank personal loans starts at 11% p.a. However, specific interest rate applicable to an applicant depends upon the person’s individual applicant profile including his/her credit score, age, loan amount and tenure desired, etc.
Axis Bank Reducing Balance vs Flat Balance Interest Calculation
In case of reducing balance method of interest calculation, the interest is calculated every month on the outstanding loan principal amount only. In this method, the interest accrued gets reduced every month as EMIs include interest payable for the outstanding loan amount for the month along with a portion of the principal amount outstanding being paid off. After you pay an EMI, the outstanding loan principal is reduced. Therefore, the interest accrued for the next month is reduced which leads to reduction in overall interest payments. The formula to calculate reducing interest rate is:
- Interest Payable per Instalment = Interest Rate per Instalment * Remaining Loan Principal Amount
When it comes to flat interest rate method, the interest rate is calculated on the full amount of the loan until the tenure ends without considering the fact that monthly EMIs gradually reduce the principal amount. The formula for calculating the loan interest using the flat balance method is:
- Interest Payable per Instalment = (Original Loan Amount x No. of Years x Interest Rate p.a.) / Number of Instalments
Axis Bank uses reducing balance method to calculate the interest payable on personal loans. Therefore, the interest accrued decreases with each successive EMI payment.
EMI Calculation Using Reducing Interest Rate
The table indicates loan amount to be paid every month against different tenures and monthly EMIs that are calculated using the reducing interest rate method.
| Loan Amount (Rs.) and Interest Rate | Monthly EMI Payout (Rs.) | ||
| 1-year loan tenure | 2-year loan tenure | 3-year loan tenure | |
| 1 lakh @ 12% p.a. | Rs. 8,885 | Rs. 4,707 | Rs.3,321 |
| 6 lakh @ 14% p.a. | Rs. 53,872 | Rs. 28,808 | Rs. 20,507 |
EMI Calculation Using Flat Interest Rate
The table depicts loan amount to be paid every month against different tenures and monthly EMIs that are calculated using reducing interest rate method.
| Loan Amount (Rs.) and Interest Rate | Monthly EMI Payout | ||
| 1-year loan tenure | 2-year loan tenure | 3-year loan tenure | |
| 1 lakh @ 12% p.a. | Rs. 8,333 | Rs. 4,167 | Rs. 2,778 |
| 6 lakh @ 14% p.a. | Rs. 50,000 | Rs. 25,000 | Rs. 16,667 |
Axis Bank Personal Loan Interest Rate Calculation
Axis Bank personal loan interest rate starts at 11% p.a. The following table gives a sample of the total interest payout, total amount repaid and the proportion of interest in total amount repaid for varying loan amounts, tenures and interest rates:
| Loan Amount (Rs.) | Tenure (years) | Total Interest Payout (Rs.) | Total Amount Repaid (Rs.) | Proportion of Interest in Total Amount Repaid |
| 1 lakh @ 11% | 1 | 6,058 | 1,06,058 | 6% |
| 10 lakh @ 13% | 3 | 2,12,982 | 12,12,982 | 18% |
| 15 lakh @ 15% | 5 | 6,41,094 | 21,41,094 | 30% |
Axis Bank Personal Loan Interest Rate Comparison
The following table compares the key features of personal loans offered by Axis Bank to those of some leading banks in India:
| Criteria
| Axis Bank | HDFC Bank | Citibank | ICICI Bank | State Bank of India |
| Interest Rate | 11% p.a. onwards | 10.50% p.a. onwards | 9.99% p.a. onwards | 10.50% p.a. onwards | 9.60% p.a. onwards |
| Tenure
| 12 to 60 months | 12 to 60 months | 12 to 60 months | 12 to 60 months | 12 to 72 months |
| Loan amount | Rs. 50,000 to Rs. 15 lakh | Up to Rs. 40 lakh | Up to Rs. 30 lakh | Up to Rs. 25 lakh | Up to Rs. 20 lakh |
| Processing Fee | Up to 1.5% of the loan amount | Up to 2.50% of the loan amount | Up to 3% of the loan amount | Up to 2.25% of loan amount | Up to 1.50% of the loan amount |
How to Get Low Interest Rates on Axis Bank Personal Loan?
The following are some tips and tricks to get the lowest interest rates on your personal loan from Axis Bank:
- Maintain a high credit score
- Ensure stable employment history
- Pay your EMIs and credit card dues in a timely manner
- Having a good existing relationship with the bank
- Minimize outstanding debt at the time of loan application
Factors Affecting Interest Rates
The following are some of the key factors that affect the interest rate applicable to personal loans offered by Axis Bank:
- Credit score: It is one of the most important factors considered by a prospective lender before deciding the interest rate of an individual. Therefore, if you have a good credit score, it will automatically indicate that you have been regular with your past repayments and you may be able to get a lower interest rate on your Axis Bank personal loan.
- Income level: Higher the income, lower would be the interest rate offered by the bank because high income indicates that you will be able to manage your monthly EMIs and other expenses easily with lower risk of default on your repayments
- Relationship with the bank: If you have a current or savings account in good standing with the bank, you might be offered a lower interest rate on your Axis personal loan
- Employer’s reputation: If you are working with a reputed organization and have a stable job, the lender might offer you a lower interest rate on a personal loan
FAQs
Q1. Is Axis Bank personal loan interest rate fixed or floating?
Axis Bank offers personal loans at a fixed interest rate, i.e., the interest rate remains the same or unchanged throughout the loan tenure.
Q2. How does Axis Bank personal loan interest rate depend on credit score?
Generally a good credit score indicates a higher creditworthiness and good repayment track record and may help you avail a lower rate on interest on your Axis Bank personal loan. Whereas, a poor credit score indicates a greater degree of risk for the lender and may thus, result in an outright rejection or a higher rate of interest on your personal loan.
Q3. What are the factors that affect Axis Bank personal loan interest rates?
Some key factors which affect the interest rate charged on your Axis Bank personal loan include your credit score, employer’s reputation and employment history, income and your existing relationship with the bank.
Q4. Can a higher level of income help me avail a lower rate of interest on my Axis Bank personal loan?
A higher income level usually indicates greater financial stability and thus, lowers the risk of defaulting on repayments which may in turn help you get a lower rate of interest on your personal loan.
Q5. What is the lowest rate of interest that one can avail on a personal loan from Axis Bank?
At present, the lowest rate that Axis Bank offers on its personal loans is 11% p.a.
