Credit Scores
Although the lender has not specified the role of credit scores in deciding the IDFC Personal Loan interest rates, many banks and NBFCs consider the credit scores of loan applicants while fixing the personal loan interest rates.
Those wishing to avail IDFC Personal Loan can maintain/improve their credit scores by following healthy credit behaviours like timely payment of EMIs, avoiding multiple applications for credit cards or loans within short time intervals, maintaining healthy credit mix, etc. Doing so will help them increase their credit scores which, in turn, will improve their personal loan eligibility. Personal loan applicants must also frequently review their credit reports as it can help them identify mistakes and report it to their lender/credit bureaus for correction. Error(s) in credit reports can reduce the credit score of loan applicants and adversely affect their eligibility for availing personal loans. Lower credit scores may also reduce their chances of availing lower IDFC First Bank Personal Loan interest rates.
Income
IDFC First Bank does not specify the role of their loan applicants’ income while setting the interest rates on their personal loans. However, many lenders provide lower interest rates on personal loans for applicants having higher monthly/annual incomes. Personal loan borrowers having higher incomes usually have higher loan repayment capacity, which in turn reduces the credit risk for the lenders. This benefit is then passed on to borrowers in the form of lower interest rates.
Occupation Profile
IDFC Personal Loans are offered to self-employed loan applicants with business continuity of at least 3 years. Although the bank has not disclosed the role of the loan employer profile of their loan applicants’ in determining the IDFC First Bank Personal Loan interest rates, many lenders consider this criteria while deciding their personal loan interest rates. Lenders generally provide personal loans for salaried at lower rates compared to personal loans for self-employed. Among salaried applicants, lenders offer lower interest rates to employees of PSUs or government bodies considering their job and income security is usually higher versus other salaried applicants. Lenders also offer lower personal loan interest rates to employees working in MNCs or well-known private sector companies as they are better at withstanding adverse economic conditions compared to other private sector companies.
Existing Relationship with IDFC First Bank
While IDFC First Bank has not disclosed providing interest rate concessions to their existing customers, many lenders offer lower personal loan rate of interest to their existing customers. Hence, loan applicants looking to avail IDFC Personal Loans should first contact those lenders with whom they already have existing banking/lending relationships and then, compare the IDFC First Bank Personal Loan interest rates with the interest rates offered by those banks/NBFCs.
