Comparison of Personal Loan Interest Rates offered by Leading Banks & NBFCs
| Lenders | Interest Rate (p.a.) | Processing Fee (% of loan amount) |
| State Bank of India | 11.00% – 15.00% | Up to 1.50% (Rs 1,000 – Rs 15,000) |
| HDFC Bank | 10.50% onwards | Up to Rs 4,999 |
| Punjab National Bank | 10.40% – 16.95% | Up to 1% |
| ICICI Bank | 10.75% onwards | Up to 2.5% |
| Bank of Baroda | 10.90% – 18.25% | Up to 2% (Rs 1,000 – Rs 10,000) |
| Union Bank of India | 11.40% – 15.50% | Up to 1% (Maximum Rs 7,500) |
| Axis Bank | 10.49% onwards | 1.5% – 2% |
| Bank of India | 10.35% – 14.85% | Up to 1% (Maximum Rs 5,000) |
| Indian Bank | 10.00% – 15.00% | Up to 1% |
| Kotak Mahindra Bank | 10.99% onwards | Up to 3% |
| Central Bank of India | 10.95% – 12.55% | Up to 1% |
| IndusInd Bank | 10.49% onwards | Up to 3% |
| IDBI Bank | 11.00% – 15.50% | 1% (Minimum Rs 2,500) |
| Yes Bank | 10.99% onwards | – |
| UCO Bank | 12.45% – 12.85% | 1% (Minimum Rs 750) |
| Federal Bank | 11.49% – 14.49% | Up to 3% |
| Bank of Maharashtra | 9.50% – 12.80% | 1% |
| IDFC FIRST Bank | 10.49% onwards | Up to 3.5% |
| Bajaj Finance | 11.00% onwards | Up to 3.93% |
| RBL Bank | 17.50% – 26.00% | Up to 2% |
| Muthoot Finance | 14.00% – 22.00% | – |
| Citibank | 10.75% – 16.49% | Up to 2% |
| Tata Capital | 10.99% onwards | Up to 2.75% |
| Standard Chartered Bank | 11.49% onwards | Up to 2.25% |
| HSBC | 9.75% – 16.00% | Up to 1% |
| Navi Finserv | 9.90% – 45.00% | Nil (for loans of Rs 50,000 or above) |
| StashFin | 11.99% – 59.99% | Up to 10% |
| Fullerton India | 11.99% onwards | Up to 6% |
| Faircent | 9.99% onwards | 6% – 8% |
| KreditBee | Up to 29.95% | Up to 6% |
| MoneyTap | 36.00% onwards | Up to 2% |
| Dhani Loans & Services (Formerly known as Indiabulls Consumer Finance Ltd.) | 13.99% onwards | 3% onwards |
| Money View | 15.96% onwards | 2% – 8% |
| PaySense | 16.80% – 27.60% | Up to 3% |
| Home Credit | 24.00% onwards | Up to 5% |
| CASHe | 27.00% onwards | Up to 3% |
| HDB Financial Services | Up to 36.00% | Up to 3% |
Note: Interest rates as of 29 March 2023
Personal Loan EMI Calculator
Use personal loan EMI calculator to know how much EMI you would be paying during the loan tenure against different interest rates and loan tenures. The online loan calculator also works as an interest calculator as it also helps you know the total interest payable on your personal loan.
Monthly EMI ₹ 15,622
Total Amount Payble ₹ 5,62,395(Principal + interest)
Principal Amount ₹ 5,00,000
Total Interest Payble ₹ 62,395
Tips to Avail Personal Loan at Low Interest Rate
Below stated are a few important points that must be considered to get a personal loan at a low interest rate:
- Build and maintain your credit score of 750 or above
- Check for pre-approved instant personal loan offers from banks and NBFCs
- Enquire with banks/NBFCs with whom you already have the deposit and/or loan accounts
- Keep a track of interest rate concessions offered by lenders during festive seasons
- Visit online financial marketplaces to check and compare personal loan offers from various lenders
Factors Affecting Personal Loan Interest Rates
Lenders fix interest rates primarily on the basis of their cost of funds and the credit risk evaluation of their loan applicants. Here are some of the key factors that can influence your personal loan interest rates:
- Credit Score: Many lenders have started factoring in the credit scores of their loan applicants while setting their interest rates. Those having higher credit scores are offered personal loans at lower interest rates than others. Hence, try to maintain credit scores of 750 and above. Good financial habits like repaying your credit card bills and EMIs by their due dates, avoiding multiple loans or credit card applications within a short period would help you maintain higher credit scores.
Note that errors in your credit report can also pull down your credit score. Therefore, applicants should check their credit reports at regular intervals to identify such errors in time and take necessary steps to avoid adverse effect on their credit score. To check your credit scores for free either avail free credit report once a year from each of the credit bureau or visit Paisabazaar.com to view your credit scores from multiple bureaus along with their monthly updates. Those having no or low credit scores can improve their credit scores by availing lifetime free Step UP Credit Card – a secured credit card issued by SBM Bank (India) Ltd. with Paisabazaar as co-branded partner.
- Income: A higher income indicates a higher capacity to repay the loan. This leads to lower credit risk for the lender. Thus, many lenders offer lower personal loan interest rates to those having a higher income.
Check: How much personal loan can you avail based on your salary?
- Employer: Many lenders consider the employer profile of their personal loan applicants while setting their interest rates. Salaried individuals are usually charged lower interest rates than the self-employed ones due to the former’s higher-income certainty. Among salaried applicants, government and PSUs are usually offered lower interest rates due to their higher job security and income certainty. Then, comes the personal loan applicants employed with MNCs and reputed private sector organizations as such companies are usually considered to have higher chances of withstanding economic downturns than other private sector organisations.
Check: Personal Loans for Salaried Employees
- Existing lending or banking relationship with the lender: Many lenders offer personal loans at concessional interest rates to applicants having existing banking or lending with the lender. Hence, those planning to avail personal loans should always contact the banks/NBFCs with whom they already have an existing lending or banking relationship for personal loan offers.
FAQs
1. Which bank offers the lowest personal loan interest rate?
Ans. The lowest personal loan interest rates available through Paisabazaar.com are offered by Axis Bank, IDFC First Bank and IndusInd Bank at 10.49% p.a. onwards. However, there are some public sector banks that may offer lower personal loans interest rates to select segments. Also keep in mind that the final personal loan interest rate offered by any bank/NBFC will depend on multiple parameters like the applicant’s credit score, monthly income, occupation profile, etc.
2. What is a Reducing Personal Loan Interest Rate?
Ans. Reducing interest rate is a method in which interest rate is calculated on the outstanding loan amount every month. During this type of rate, the EMI includes the interest payable on the outstanding loan amount.
3. How can I check the total interest payout for my personal loan?
Ans. You can check both your monthly EMI and total interest payout using the personal loan EMI calculator. All you need to provide are the loan principal, the interest rate and the loan tenure to get instant results.
4. Do government employees get special low-interest rates on personal loans?
Ans. Many leading banks in India do currently offer special interest rates on personal loans to government employees. This is due to the higher job stability typically associated with those in government service as compared to private sector employees. To know the details of such offers and whether you qualify, you should contact the prospective lender.
5. What is the difference between fixed and floating personal loan interest rates?
Ans. In the case of fixed interest rate loans, the rate remains unchanged over the entire tenure of the personal loan. In the case of floating rate loans, the rate can change periodically due to changes in market interest rates. Currently, most personal loans are offered at fixed rates as most of these loans have a relatively short tenure of up to 5 years.
6. I already have a savings account with the State Bank of India. Will I get a low interest rate if I apply for a personal loan with SBI?
Ans. Having a prior banking relationship such as a savings or current account in good standing with a prospective lender can help you get a lower interest as compared to other prospective borrowers. However, this benefit is not guaranteed and you will have to get in touch with the State Bank of India to know if you are eligible for this benefit.
7. Can offering collateral help me avail lowest personal loan interest rate?
Ans. The interest rate offered on your personal loan depends upon the level of risk you pose for the lender. Collateral serves as a security against default on repayments and minimizes the risk for the lender which may help you get an affordable interest rate on your personal loan. However, do remember in case you fail to repay your loan on time, the lender can liquidate your collateral to recover the loss.
8. How do my employment history and experience play a role in determining the personal loan interest rate?
Ans. Being employed with a reputed company for a long signifies that you have a relatively stable source of income and you pose less risk to the lender. Thus the lender may provide you lower interest rate.
9. Can I get personal loan at low rate of interest despite having low credit/CIBIL score?
Ans. Personal loan applicants having credit scores of 750 and above reflect good credit behaviour and financial discipline. Therefore, such applicants have higher probability of getting their personal loan applications approved. Conversely, applicants having credit scores below 750 have lower chances of getting a personal loan. However, some NBFCs and fintech lenders offer personal loans to individuals with low credit score. Such lenders usually charge higher interest rates than those offered by large banks and major NBFCs.