• It is an unsecured loan which means a loan offered without keeping any assets (e.g., house or car) as collateral. Unsecured personal loans are offered based on the applicant's credit history. If you have not defaulted on payments of an earlier loan and have paid all your credit card bills on time, you will be viewed as a low-risk borrower.
• Interest rates for personal loan is allocated according to the customer's salary, the amount being borrowed, loan tenure and other criteria that differ from one lender to another.
• The repayment time period is fixed and ranges from 1 to 5 years.
• A personal loan requires minimum paper work and is often approved within 48 hours of submitting an application.
• In addition to a processing fee (up to 1% of the amount borrowed), other charges levied on a personal loan includes pre-payment fee, late payment penalties, documentation charges and cheque bounce/swap charges.

What are the different types of Personal Loans?

Types of Personal Loan	Features of the loan	Financial Institutions offering this loan
Personal Loan For Low CIBIL Score	For people with low credit or CIBIL score Rate of interest is high	Though it is not easy to get a personal loan with a low CIBIL score, but you will have to negotiate with banks or you can opt for a secured personal loan. Some banks may offer a personal loan to you if your income has increased by a good amount recently.
Business Startup Loan	For SME & start ups No interest will be charged for the first 15 months, after which the average interest rate is around 7.9% and 19.9%	ICICI Bank, Small Industries Development Bank of India (SIDBI) and India Finance Corporation Of India (IFCI), Kotak Mahindra, TATA Capital, Standard Chartered, Bank of Baroda, Oriental Bank, etc.
Same Day Loans	For people in need of emergency cash Loan approval in minutes Higher interest rate	Citibank & HDFC Bank
Loans For Unemployed	For unemployed individuals Most of the loans require no collateral Interest rate is high	Government loan plans for the unemployed, TATA Capital, India Lends, Max finance, etc.
Govt. Loans for Small Scale Businesses	For small scale business Lower rate of interest under the government schemes	State Bank of India, Bank of Baroda, Andhra Bank Loan schemes by government- Small Industries Development Organization (SIDO), National Small Industries Corporation Limited (NSIC), SIDBI, National Bank for Agriculture and Rural Development (NABARD) and World Association for Small and Medium Enterprises (WASME)
Small Business Loans for Women	Exclusive loans for women entrepreneurs Different schemes on the offer include Udyogini Scheme by Punjab & Sind Bank, Mahila Udyam Nidhi Scheme by SIDBI, Dena Shakti Scheme by Dena Bank and many more.	HDFC, TATA Capital, Citibank, IndusInd, Fullerton, Kotak Mahindra, ICICI, Bank of Baroda, IDBI, Punjab & Sind Bank, Dena Bank, etc.
Corporate Loan	For existing businesses or industrial houses Both unsecured and secured loans available	HSBC, HDFC, TATA Capital, Kotak Mahindra, Citibank, IndusInd, Standard Chartered, ICICI, Allahabad Bank, Bank of Baroda, etc.
Home Improvement Loan	For renovation, repair, furnishing of house Some banks cover 100% while others cover up to 90% of the costs. Fixed interest rate ranges from 9% p.a. to 12.5% p.a.	HDFC, ICICI, PNB, Canara Bank, DHFL, Bank of Baroda, etc.
Medical Loan	For funding medical expenses, such as hospitalization, surgery, etc. No collateral or security required Loan amount can be up to 25 lac	SBI, TATA Capital, Arogya Finance, etc.
Marriage Loan	For funding the marriage expenses Loan amount ranges between 5 lac to 20 lac Interest rates vary between 13.49% – 34%	SBI, HDFC, ICICI, Tata Capital,  Axis Bank, Citibank, IDBI, PNB, Kotak Mahindra, Bank of Baroda, etc.

Any Indian national salaried, self-employed or professional is eligible for a personal loan. However, this loan is an unsecured loan, thus lenders make sure that they are not lending money to a client with higher probability of risk involvement. To ensure the same, they consider numerous factors before providing personal loans:

• Repayment ability: Applicant should have been employed by your current organization or been involved in your business for a certain number of years
• Income: Applicants should have the lender stipulated monthly repaying capacity or minimum salary
• Age: Applicant must qualify for the applicant age bracket defined by the lending institution
• Credit Rating: Applicant should have the bank specified credit score and suitable credit history
• Existing EMIs: Applicant should not have any other loan liabilities or must have strong ability to take addition debts.

Most banks have similar guidelines for documentation requirement for personal loan. The list of essential documents you need for a personal loan are:

For self-employed individuals:

• Duly signed and filled application form
• Passport Size Photographs
• Identity Proof: To apply for a Personal Loan submit one of the following documents as identity proof:
  • Aadhar Card
  • Voter's ID Card
  • Employer issued ID card
  • Driver's license
  • Passport
  • Ration Card
  • Electricity bill
  • Title deed/utility bill/municipal tax receipt
  • PAN Card
  • Telephone/mobile bill
  • Life Insurance premium receipt
• Proof of Age: List of documents that are accepted for age proof to apply for Personal Loan are:
  • Birth Certificate
  • Secondary school certificate (Class 10)
  • Passport
  • PAN card
  • Aadhaar Card
  • Voter ID card
  • LIC Policy or premium receipt
  • Ration card
• Address Proof: For address proof confirming your present residential address, submit any one document from the list:
  • Government-issued employee residence proof
  • Ownership and title deeds of property
  • Telephone bills
  • Ration card
  • Electricity bill
• Income Proof

  For salaried individuals:

  • A copy of latest salary slips (3-6 months depending upon the bank) or salary certificate
  • Form 16 and a copy of ITR for the last two years
  • Copy of the appointment letter or an employment certificate to prove job continuity
  • Last 3 months' salary account statements
  • Proof of employment certificate
  • Last two years' computation of income, Profit and Loss statement, and balance sheet certified by a C.A.
  • Latest six months' bank statement of all your bank accounts
  • Last two years' sales and copies of acknowledged IT returns as proof of turnover

Interest Rate	10.75% onwards
Processing Fees	Differ From Bank to Bank
Loan Tenure	Up to 5 Years
Pre-closure Charges	Differ From Bank to Bank

 

As mentioned earlier, personal loans feature one of the highest interest rates among debt instruments only superseded by credit card interest rates. Currently personal loans are available in India from 10.75% onwards. The exact interest rate differs from bank to bank as well as on the basis of the loan amount, the loan tenure, your income level as well as your credit history.

Must Read: Personal Loan Interest Rates Impacted by 4 Factors

Personal loan allows you to borrow money for almost all your requirements and to have a better experience, there are certain points you must know before availing a personal loan.

• Loan Amount & Tenure: Depending on your income and repayment capacity, decide upon the loan amount you need and for how much duration.
• Eligibility: Checkout eligibility criteria of different banks and identify in which one do you fit the most.
• Processing Time: For your immediate monetary requirements, knowing about the processing time of personal loan can be of great help.
• Interest Rate & other charges: Your complete loan experience depends upon the interest rate, processing charges, prepayment charges and other such charges. Know them before hand to take a well-informed decision.
• Repayment History: Your financial health will define your credit worthiness. Make sure you have all the necessary documents to prove your strong credit history and income.
• Documentation: Jot down the list of documents required to apply for personal loan.
• Foreclosure: Do not ignore independent foreclosure policy and charges of different banks.

1. State Bank of India

With its headquarters in Mumbai, SBI (State Bank of India) is a leading Government-owned bank in India and offers different types of exciting personal loans to the customers. The 4 different types of personal loans that SBI offers are:

Rate of Interest of SBI Personal Loan:

• The base interest rate of SBI Xpress Credit Personal Loan is 10%.
• SBI Saral personal loan interest rate is 18.5% p.a.
• The interest rate for the Jai Jawan Pension Loan scheme is 14.75% per annum.
• The interest rate for SBI Festival Personal Loan is 16.75% per annum.

Some of the highlighting features of SBI Personal loans are:

• Attractive rate of interest
• Timely Discounted Schemes
• No Hidden Charges
• Zero Prepayment Penalty
• Quick Loan Approval
• Online Loan Submission
• High Quantum of Loan
• 24/7 Customer Support

2. Axis Bank Limited

With a network of 2500 branches (as on March 2016), Axis Bank is the third largest private sector bank in India and is trusted widely for its personal loan plan. With features like minimal documentation, simple procedures, and quick loan approval, Personal loan scheme is availed widely by people from all over India to fulfill their immediate financial requirements.

• Axis Bank offers personal loans for both salaried and self-employed individuals.
• Personal loans from Axis Bank are available from Rs. 10,000 to Rs. 15 lakhs
• Axis Bank offers a flexible tenure for personal loans ranging between 12 to 60 months.
• The personal loan interest rates charged by the bank ranges between 15.50% and 24%. (This is floating rate and is subject to market fluctuations.)
• Axis bank offers eDGE loyalty points on personal loans. These points can be redeemed for cash surplus and discounts.
• Multiple repayment options are offered by Axis Bank which includes Electronic Clearing Services or ECS and Post Dated Cheques.

3. ICICI Bank

With over 4000 branches, ICICI Bank offers multipurpose personal loan to its customers all over India. One of the biggest reasons for ICICI bank being one of the largest facilitators of personal loan is its adherence to quick loan approval processing. Without any need of security, collateral, or a guarantor, and with just nominal documentation, a person can apply for ICICI Bank personal loan and get instant approval too.

Highlights:

• Rate of interest: Interest rates as low as 11.49% - 17.50% (Fixed) on your personal loan.
• Loan amount: 20L Max loan amount
• Loan tenure: 1-5 Years

Benefits of ICICI Bank Personal Loan:

• ICICI Bank offers fixed Interest rate for Personal loan, i.e. interest remains unchanged throughout the loan tenure
• To get ICICI Personal Loans one does not require going through large documentation process.
• ICICI Bank facilitates quick loan approval and disbursal
• ICICI bank offers direct credit of the personal loan amount via Fund Transfer (FT)
• ICICI bank offers simple repayment options of ECS, AD or PDC.
• It is disburse within 72 hours* of document submission.

ICICI Bank offers Personal Loan for:

• House renovation
• Holidays
• Purchase of consumer durables
• Education
• Marriage
• Short Term loan for equipment purchase
• Short Term Working Capital
• Any other personal emergency

4. Punjab National Bank

Punjab National Bank, also popular as PNB, is an Indian public sector bank that is known for its personal loan services along with many other core banking services. PNB offers personal loan to make available financial assistance to the public for their personal needs.

Personal Bank by Punjab National Bank is offered to:

• Salaried applicants
• Self-employed applicants
• Pensioners drawing their pension through any of the PNB branches in the country

Highlights:

• Punjab National Bank offers floating interest rate to the applicants. Base Rate - 9.60% | Base Rate+ (3% to 6%)
• PNB offer Personal loan for upto 5 years tenure
• Guarantor Requirement : Guarantor required
• Bank offers a personal loan of up to 20 times the net monthly income for salaried individuals and up to Rs. 10 lakhs to pensioners.

5. UCO Bank

UCO Bank, formerly United Commercial Bank, is one of the oldest and major banks in the country. UCO Bank Personal Loans or UCO Bank Cash is one of the many widely trusted services and is taken up by several individuals to meet their personal financial needs. UCO Bank offers personal loan without the need of depositing collateral security for an amount of up to Rs. 2 Lacs. For loan amount above Rs. 2 Lacs, the applicants have to offer collateral for only 40% of the loan amount.

UCO Bank Personal Loan Highlights:

• Loan Scheme: UCO Cash
• Loan offered to: Both Salaried & Self-employed individuals
• Loan amount: Minimum Rs. 50,000 and Maximum Rs. 10, 00, 000
• Repayment tenure: 12 - 48 EMIs for men and 12 - 60 EMIs for women
• Rate of Interest: base + 5.40% = 15.35% for men and base + 4.40% = 14.35% for women

6. HSBC Bank

Presence in India since 1959, HSBC bank is one of the world's largest banks with more than 89 million customers globally. HSBC offers a great many financial products and services to the Indian customers, of which Personal Loan is a distinctively popular product. In major cities in India, HSBC offers personal loan with features like attractive interest rates, nominal documentation, and speedy processing.

HSBC offers Personal Loan for:

• Marriage expenses
• Shifting an existing loan from another bank
• House restoration or other home related payments
• Buying consumer durables or equipment
• Travel expenditures
• Any other personal needs and emergencies

Highlights:

• Rate of interest for personal loans ranges between 11.99% to 18.34%
• HSBC offers personal loans with flexible tenure of up to 5 years (i.e. tenure from a minimum of 12 months onwards with additional block of 6 months).
• HSBC offers maximum loan amount uptoRs. 15 lakhs. Selected customers may be eligible for loans uptoRs. 20 lakhs.
• HSBC offers easy monthly repayment through:
  • Equated Monthly Installments (EMI)
  • Electronic Clearing System (ECS)
  • Standing Instruction (SI) on HSBC bank account
• For HSBC personal loan, there is no requirement of collateral/guarantor
• HSBC offers easy documentation, quick processing and disbursal for Personal loan.

7. IDBI Bank

Head quartered in Mumbai, India, IDBI Bank Limited (IDBI) is currently 10th largest development bank globally for its extensive reach with 1413 branches and 2413 ATM's. Personal Loan from IDBI Bank is offered to both self-employed professionals and salaried individuals. IDBI Personal Loan plans are an amazing way to meet any personal financial requirements. From buying an electronic gadget to renovation of house to a family vacation, IDBI makes sure none of your needs or wants go unfulfilled due to lack of cash.

Available variants of IDBI Bank:

• Salaried and self-employed professionals
• Salary a/c in IDBI with built-in Overdraft (OD) facility
• Salary a/c in IDBI with built-in OD facility to IDBI Bank Pensioners

IDBI Personal Loan Details:

• Interest Rate (Fixed): 12.75% to 13.75%
• Processing Fees: 1% of the loan amount +applicable taxes
• Loan Tenure: 60 Months
• Pre-closure Charges: 2.00% + applicable taxes. After 6 months the charges are NIL.
• Guarantor Requirement: No Guarantor Required
• Attractive personal loan rate
• Low Processing Fees & Documentation Charges
• Faster Approval & Minimum Documentation
• Repayment period up to 60 months
• No collateral/security
• The Loan tenure is 1 yr 5 yrs
• Loan amount = Rs. 50,000 Rs.1000000

8. Standard Chartered Bank

Operating in India since 1858 with branches over 42 cities, Standard Chartered bank has always been known for its exciting schemes, friendly repayment provisions and competitive interest rates. The same are the features of personal banking offered by Standard Chartered Bank. Under its personal banking, Standard Chartered offers personal loans, home loans, loans against securities, etc.

Like other banks, Standard Charted understand the value of personal loan for every individual to meet his/her dreams of life without worrying about cash, and has thus formulated attractive features of Personal loan.

Features of Standard Charted Personal Loan:

• Standard Chartered Personal Loan is offered to both salaried and non-salaried individuals.
• Bank offers flexible repayment tenures from 12 months to 60 months.
• There is no need of security or guarantor to avail Standard Charted' Personal Loan.
• Documentation processes are easy and simple
• Personal loan online from Standard Chartered can be availed with instant approval.
• Standard Chartered offers personal loans up to Rs.30 lakhs to salaried employees and up to Rs.10 lakhs to the entrepreneurs.

Standard Charted Bank Personal Loan Details:

• Interest Rate (Monthly reducing balance): 12.50% to 17.00%
• Processing Fees: Nil
• Pre Closure Charges: Pre-closure permitted after 1 year. 5% of principal outstanding (plus ST)
• Loan Tenure: 1 year to 5 years
• Guarantor Requirement: No guarantor required

9. Andhra Bank

Head quartered in Andhra Pradesh, Andhra Bank is a mid-sized public sector bank and has more than 2000 branches in India. Andhra Bank offers different loans to meet monetary needs of the people; every loan plan is tailor-made to help the individual borrow for what he actually requires.

Andhra Bank Personal Loan is divided into two different categories: 

Consumer Loans:

Consumer Loans are the personal loans given to salaried individuals. Personal loan is offered to salaried individuals to meet their personal needs that can be purchasing consumer durables like televisions, or making wedding arrangements for a child, or sponsoring child's higher education. This scheme caters to the consumer credit requirements of persons with a regular source of income.

Clean Loans:

Clean Loans are the loans given to self-employed individuals for their personal requirements. With Clean Loans by Andhra Bank, a self-employed consumer can easily meet his person monetary requirements such as a children's education and weddings, paying off credit card debts, vacations etc.

Andhra Bank Personal Loan Details:

• Interest Rate (Floating):
  • Upto 3 years :BR+5.50%
  • Above 3years : BR+5.50%+0.25%
• Loan Tenure: 60 months
• Pre Closure Charges: Nil
• Guarantor Requirement: Guarantor required

10. HDFC Bank

In terms of its assets, HDFC bank is the fifth largest bank in India. HDFC bank has won the trust of the customers with its exclusive personal loan plans which ensure triple benefits, i.e. faster loan, competitive pricing, and transparency. With a flexible loan duration ranging 12 to 60 months and a competitive interest rate, HDFC Bank offers best personal loan services in the country.

HDFC Bank Personal Loan Details

• Interest Rate (Monthly reducing balance):11.29% to 20.00%
• Processing Fees: 0 to 2.5% of Loan Amount
• Loan Tenure: 1 year to 5 years
• Pre-closure Charges: Pre-closure permitted after 1 year. 4% of principal outstanding (plus ST) in 2nd year. 3% (plus ST) in 3rd year. 2% (plus ST) afterwards
• Guarantor Requirement: No guarantor required

Features of HDFC Personal Loan

• With its quick loan disbursal feature, HDFC Bank assures loan applicants that they would not have to go through delays and will enjoy fastest loan disbursal time as compared to a other private sector as well as public sector banks in the country.
• HDFC Banks offer loans for salaried, self-employed individuals, working professionals at competitive interest rates.
• HDFC Bank is one of the leading banks to offer online personal loan applications and submissions with instant approval.
• HDFC Bank offers lower prepayment charges for personal loans compared to other banks.

Personal loan EMI calculator proves to be the most valuable personal loan comparison tool. No doubt, Personal loan is one of the simplest loan types with no obligations connected regarding usage of the borrowed money, still there are several aspects to consider, which can be easily done via personal loan EMI calculator.

A Personal Loan Calculator helps you to:

• Identify the right amount you need to borrow
• Figure out the amount of interest you would have to pay
• Know the most suited tenure for personal loan
• Borrow with the most competitive personal loan interest rate

How to Calculate EMI on Personal Loans?

Before you apply for a personal loan, it is important that you have a budget in mind as well as an EMI amount that you are comfortable with. The EMI calculation helps you ensure that your monthly budget is not stretched and you minimize the chances of default on your personal loan. Use the Paisabazaar Personal Loan EMI calculator to get the EMI amount based on your inputs such as loan amount, interest rate and loan tenure.

At Paisabazaar.com, you are saved from the hassle of visiting individual sites of banks and other lenders to compare personal loan options available to you. Our platform allows you to review and compare personal loans of different types based on key criteria specified by you. Find the loan that meets all your terms and conditions and apply for it on the same website. Our personal loan EMI calculator helps you assess your EMI for the personal loan before applying. If you have already decided on an EMI amount, you are better prepared to manage your finances.

Why should you choose Paisabazaar for your Personal Loan assistance?

• Our forte. Your benefit

Our expertise in identifying the right deal is a benefit for those looking to take personal loan. With the ultimate feature of comparing different personal loans, we handpick personal loan offers from several banks so that intended borrowers can take well-informed decisions. To make sure that you take a well-informed decision, we have simply broken down different aspects that decide how best the loan type would match your requirement. To help you skip the fine print terror, we have segregated the sections - EMIs, eligibility, maximum amount that can be borrowed, fees, and hidden charges, so that you choose only what you need.

• Instant assistance

Be it for higher education, marriage, shopping needs, a personal emergency, or just need of extra cash, you can anytime get instant cash with personal loans. And to help you in emergency situation, we offer 24*7 services.

• We help you apply online

No doubt, online services save time as well as money. We further ease the experience of online personal loan application by offering our super friendly customer service to answer all your concerns while you are applying.

• We let you compare, but that's not the limit

Yes, we have a platform where you can compare schemes by companies offering personal loans, but that's not all at Paisabazaar's platter. Our experts assist every customer in applying for a personal loan in the bank of his choice to the stage you get your loan amount.

• A-Z customer support

Paisabazaar's customer support team help the interested borrowers understand the complete process of availing personal loan or personal loan against mutual funds and clear all their doubts regarding eligibility, offers, procedures, documentation, and repayment options. Not just that, they even coordinate with the banks and follow up on your behalf.

Q. How is the maximum EMI Amount calculated?

Ans: Banks mostly based their loan amount based on the maximum EMI amount that the individual can afford. This EMI usually capped at 30% to 40% of the applicant's net take home salary. If you have any existing loans, the maximum personal loan EMI will drop accordingly.

Q. Does my credit history and score affect my chances of a successful application?

Ans: A personal loan is usually based on criteria such as your monthly net income and your previous credit history including score. Hence, credit score plays a key role in both ensuring the success of the application as well as in determining the interest rate of the loan.

Q. Is there a prepayment penalty on personal loan?

Ans: Yes. Most banks and NBFCs charge a prepayment penalty of 1% to 3% on the outstanding principal amount of a personal loan.

Q: Can I get a personal loan for pensioner if I have a pension account with one of the leading private banks in India?

Ans: There are several private as well as public sector banks, which offer personal loan to pensioners. However, there is certain age cap with every bank, which you must not exceed at the time of repayment period. You can get a personal loan of up to 10-20 times (depending upon banks' T&C) of your monthly pension amount.

Q: I want to buy a car for commercial purpose. Should I take Car Loan or Personal Loan?

Ans: To buy a car for commercial purpose you would either have to apply for personal loan or Commercial Vehicle loan. Commercial vehicle loan are comparatively cheaper than personal loan, however there are some specific eligibility criteria that you need to fulfill. In case, it is difficult to meet the eligibility criteria of commercial vehicle loan, you can avail a personal loan.

Q: What are some of the pros & cons of personal loan?

Ans: Personal Loans can help you manage all kinds of money troubles; however they come with certain pros & cons, which you must know. Here are disadvantages and advantages of personal loan

Pros

• No collateral: It does not require any collateral or security to avail a personal loan; you can easily apply for a personal loan, as long as your Credit Score is good.
• Minimal paperwork: As compared to other secured loans, personal loans require much less documentation.
• Quick Approval: Several banks have introduced e-application process which is faster as well as hassle free. Some banks even offer pre-approved personal loans and e-approvals.
• Flexibility: There is no capping on the usage of borrowed personal loan amount unlike other secured loans.

Cons:

• Qualification criteria: While the guidelines for availing personal loan vary from bank to bank, qualification criteria are quite strict. It is must to have a good credit history to avail personal loan.
• High Interest Rates: Interest rate of personal loan is though less than interest rates on Credit Cards but still higher than secured loans.
• Prepayment penalty: Several banks charge prepayment penalty on prepayment of Personal Loans.

Q: How can I bargain for better rate of interest for personal loan?

Ans: Yes, there are certain points that can help in getting lower interest rates for the borrowed personal loan amount.

• Due to competition, several banks announce schemes on personal loans during festive season. Request for a personal loan quote at this time as such seasonal offers are good to get attractive interest rate deals.
• Credit score can be a reason of rejection, and it can be a reason to get a better deal. You may bargain with banks for best personal loan deal on having a high credit score.
• A good track record for repayment of loans can be helpful in getting attractive deals

Visit Personal Loan FAQs page for more questions.