Personal loan processing fee ranges from 0.5% of loan amount to 4% for loan amounts of up to Rs 40 lakh. Some banks/NBFCs waive off the processing fee during special festive offers. PSU Banks usually charge lesser processing fee as compared to Private Sector Banks.
Processing Fees and Charges Offered by Top Lenders in India
| Name of Lender | Processing Charges (% of loan amount) |
| HDFC Bank | Up to Rs 4,999 |
| Tata Capital | Flat Rs 76 |
| ICICI Bank | Up to 2.50% |
| State Bank of India | NIL (till 31st January 2024) |
| Axis Bank | Up to 2% |
| Kotak Mahindra Bank | Up to 3% |
| Bajaj Finserv | Up to 3.93% |
| IDFC First Bank | Up to 3.50% |
| IndusInd Bank | Up to 3% |
Note: Charges as of 4th October 2023
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Important Fees and Charges of Personal Loan
Processing Fee
The processing fee is the total cost charged per online transaction. It is generally a certain percentage of the loan amount charged to cover the administrative costs of processing the application of the borrower or prospective resident. The processing fee charged by lenders can go up to 4% of the loan. However, some banks/NBFCs have capped the processing fee amount, irrespective of the loan amount.
Pre-payment Charges
Pre-payment charge is charged by banks/NBFCs when the borrower prepays part of the loan amount. However, lenders have been barred by the RBI to levy pre-payment fee on personal loan lent on floating interest rates.
Also Know: Is there any prepayment penalty for personal loan?
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Foreclosure Charges
This penalty is charged by the borrower in case he/she closes the loan account before the completion of loan tenure. Some lenders do not allow foreclosure of the loan account until the repayment of a pre-determined number of EMIs. This does not hold true for floating interest rates. As with prepayment charges, lenders have been barred by the RBI to levy foreclosure fee on floating interest rates for personal loan.
Loan Cancellation Charges
Some applicants might wish to cancel the loan amount after it has been sanction or disbursed. A loan cancellation fee is to be paid by the applicant, which varies for different banks/NBFCs. Loan cancellation fee of Rs 1,000 is usually charged per event.
Cheque Dishonour Charges
A certain amount is charged from the personal loan borrower in case the cheque deposited by him/her bounces. This amount can go up to Rs 450 per instance, which might vary for different lenders. Some lenders may also charge higher cheque dishonour charges on the repeated instance of cheque dishonours.
