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Personal Loan Interest Rates

Personal Loan Interest Rates charged by most banks range from 9.9% to 24% p.a. If you meet all the eligibility criteria of the lender, getting low interest Personal Loans can become easier for you. Apply for a Personal Loan today and get instant disbursal on approval. Having a credit score of 750 of above can get you best personal loan interest rates. The interest rate on your loan affects the EMI to be paid. Higher interest rate means higher EMI amount.

Updated:

Current Personal Loan Interest Rates 2022

Interest RateStarting @ 9.99% 
Check Best Offers
Processing FeeUp to 1.5%
Loan Tenure1 to 5 years
Lowest EMI Per Lakh2,144 for 5 years
Prepayment ChargesNil
  • Compare Current Interest Rates on Personal Loan starting @ 9.9%
  • Choose the best loan provider from the list of our 100+ banking & nbfc partners, including HDFC Bank, IDFC First Bank, Navi, Bajaj Finserv, and ICICI Bank for Instant Personal Loan.
  • Apply for a Personal Loan online instantly with the chosen lender and get quick decision on your application.

Compare Best Personal Loan Interest Rates of All Banks - Nov'2022

Here is a comparison between personal loan offers from top banks in India, based on interest rates and processing fees. These two charges make the most of the overall cost of personal loans. This table can help you with deciding which is the most affordable personal loan available right now.

BanksInterest RatesProcessing Fees
HDFC Bank10.5%Up to 2.50%
ICICI Bank10.75%Up to 2.25%
IDFC First Bank10.49%Up to 2%
Navi9.9%3.99% to 6%
SBI10.65%Up to 1.50%
Yes Bank10.99%Up to 2.50%
Kotak Mahindra Bank10.75%0.75% ( till 25th Oct )
Bajaj Finserv13%Up to 4.13% + GST
HSBC Bank9.25%Up to 1%
Axis Bank10.25%1.50% to 2% + GST
PNB10.60%Up to 1% + GST
Federal Bank11.49%Up to 3%
Bank of Baroda10.25%Up to 2%
Canara Bank13.15%Up to 0.50%
IndusInd Bank10.49%Up to 2.50%
Central Bank of India 11.75%Up to Rs. 500
Indian Bank 10.30%As communicated by corporate office
UCO Bank10.70%Up to 1%
Bank of India9.75%Up to 2%
South Indian Bank12.50%2% + GST
IDBI11%Up to 1% + taxes
Dhanlaxmi Bank12.40%Up to 2.5%

Which is the best bank to get better Personal Loan Interest Rates

When you are going for a Personal Loan then the most important thing that keeps running through your mind is whether you will get a decent interest or how much the EMI for a 5 year term is going to be. To answer this question, let's take a look at some of the banks who are offering personal loans at very low interest rates.

Yes Bank Personal Loan Interest Rates

If you believe in instant solutions to your personal finance problems then Yes bank Personal Loan is for you. With interest rates starting from 10.99%(if your credit score is 750+) that can go upto a full blown 24%(if your credit score is really in bad shape), Yes bank offers a credible way out to sort out your financial requirement. For a period of 5 yrs, a Rs 1 lakh loan can give you an EMI of Rs 2174  

Kotak Mahindra Bank Personal Loan Interest Rates

If you are looking for a quick loan approval with 100% digitized process then Kotak Mahindra Personal Loan can be the right fit for you. With interest rates starting from 10.75%(if your credit score is 750+) that can go upto a full blown 24%(if your credit score is really in bad shape), Kotak Mahindra bank offers a credible way out to sort out your financial requirement. For a period of 5 yrs, a Rs 1 lakh loan can give you an EMI of Rs 2162

ICICI Bank Personal Loan Interest Rates

Ever heard about 3 second loan approvals! Well, it’s here…With ICICI you have this luxury of availing an instant personal loan with much ease. With interest rates starting from 10.50%(if your credit score is 750+) that can go upto a full blown 24%(if your credit score is really in bad shape), ICICI bank offers a credible way out to sort out your financial requirement. For a period of 5 yrs, a Rs 1 lakh loan can give you an EMI of Rs 2149  

Lowest Interest Rate on Personal Loan

Compare current Personal Loan Interest Rates on MyMoneyMantra.com and save lakhs on your Personal Loan EMI by getting the best rates. Current lowest personal loan interest rate starts from as low as 9.99% p.a. A Personal Loan is an unsecured loan for which you are not required to submit any collateral or security. Personal Loans can be used for almost any purpose, such as medical emergency, travel, wedding, purchase of a new gadget, etc. Most of the time, people are conscious while opting for a Personal Loan. MyMoneyMantra presents to you a complete analysis of all the best Personal Loan interest rates from major banks, which will help you analyse and understand the best loan options available to suit your requirements.

Which Type of Rate is Best for your Personal Loan?

There are mainly 2 types of interest rates that you can consider before going for a personal loan - Fixed and Floating.

Types of Personal Loan Interest Rates

There are two most common types of interest rates on loans that are followed by all lenders, i.e. fixed interest rate and floating interest rate.

  • Floating Interest Rates       
    These rates of interest are revised every quarter. The interest levied on your loan will be linked to the base rate determined by the Reserve Bank of India (RBI). With any changes in the base rates, the interest rate on the loan will also be changed.
  • Fixed Interest Rates       
    In this interest rates model, the lending rates on your loan will remain unchanged for the entire term of the loan. These rates are not affected by any change in the economic factors.

Although both interest rate types have their own merits and demerits, there are a few things you should consider while deciding which interest type you should opt for:

  • Any changes in the floating interest rate will not affect your EMIs. Instead the loan tenure will vary.
  • As per the RBI rules, lenders cannot levy any prepayment charges on floating interest rate loans.
  • Fixed interest rates are 1% to 2% higher than prevailing floating interest rates.
  • Fixed interest rate provides a sense of security because you know the EMIs and tenure beforehand.
  • In case of long-term loans, such as home loan, loan against property, etc., fixed interest rate switches to floating interest rate after the initial few years, depending on the lender's policy.
  • Fixed interest rates will not give you the benefit of reduced interest rate when the base rate will become lower.
  • Fixed interest rates will not increase due to increase in the base rate.

Factors affecting Personal Loan Interest Rates

It all boils down to these factors that have the potential to influence your personal loan interest rate. Check below how -In this interest rates model, the lending rates on your loan will remain unchanged for the entire term of the loan. These rates are not affected by any change in the economic factors.

Although both interest rate types have their own merits and demerits, there are a few things you should consider while deciding which interest type you should opt for:

  • Any changes in the floating interest rate will not affect your EMIs. Instead the loan tenure will vary.
  • As per the RBI rules, lenders cannot levy any prepayment charges on floating interest rate loans.
  • Fixed interest rates are 1% to 2% higher than prevailing floating interest rates.
  • Fixed interest rate provides a sense of security because you know the EMIs and tenure beforehand.
  • In case of long-term loans, such as home loan, loan against property, etc., fixed interest rate switches to floating interest rate after the initial few years, depending on the lender's policy.
  • Fixed interest rates will not give you the benefit of reduced interest rate when the base rate will become lower.
  • Fixed interest rates will not increase due to increase in the base rate.

Factors affecting Personal Loan Interest Rate

Personal Loan Balance Transfer

Personal Loan balance transfer is a facility offered by lenders where a personal loan customer can transfer their total outstanding personal loan balance from their existing lender to another. Many customers opt for this facility to get lower interest rates, better terms, and other benefits.

How does Personal Loan Balance Transfer work?

Let us assume that you have an existing Personal Loan with an outstanding of Rs.4 lakh at an interest rate of 16%. The repayment tenure is 5 years, which brings the EMI to Rs.9727. If you get any better deal from another lender, let's just say at 12.5%, then you can save close to Rs.44,000 through the balance transfer option. Look at the below illustration

 ExistingPost Balance Transfer
Total OutstandingRs.4 lakhs
Repayment tenure5 years
Interest Rate16%12.50%
Monthly EMIRs.9727Rs.8999
Total Interest on outstanding amount Rs.1,83,633Rs.1,39,951
Total Amount RepaidRs.5,83,633 Rs.5,39,951
Savings through balance transfer-Rs.43,682

How to Reduce the Effect of High Personal Loan Interest Rate with a Prepayment?

When you take out a loan on an urgent basis, chances are that you would not have thought about a high interest rate. The interest obligations can be quite higher in this case as compared to availing a loan at a lower interest rate. What if there is a way to cut your total outgo of money? If you save from your routine and prepay the loan before its original tenure, you will see that you can actually save a good amount. Let’s see with a small illustration below -  
Example – You apply for a personal loan of INR 5 lakh for 5 years at an interest rate of 20% per annum. If you prepay the loan after 3 years using your savings, how will it benefit you? Let’s find out!

Loan SummaryAmount
Interest Payable on INR 5 lakh @ 20% for 5 YearsINR 2,94,817
Interest to be Paid Till 3 YearsINR 2,37,165
Outstanding Loan Balance After 3 YearsINR 2,60,275
Savings After Paying the Outstanding Balance of INR 2,60,275INR 57,652 (2,94,817-2,37,165)

There will be some prepayment fee that you will have to pay but even after factoring all kinds of costs, it would be safe to say that you will save around Rs 50,000 in this type of prepayment.

Illustration on Personal Loan

When you consider taking a personal loan, it's always helpful to understand how much it will cost you. You must assess the annual percentage rate (APR) on a personal loan when calculating the entire cost. APR represents the annualized cost of loan repayment based on the interest rate, processing fees. The APR and loan tenure can help you determine how much you will pay in interest total over the term of the loan.

For example: 

Let's say you get a personal loan of Rs. 5,00,000 with an APR of 9% for a repayment tenure of 5 years. Considering these aspects and using our Personal Loan EMI Calculator, your equated monthly payment or EMI would be Rs. 10,379 and the total interest to be paid over the tenure of the loan would be Rs. 1,22,751.

Now assume you borrow the same loan amount but with a different tenure of 3 years, and your interest rate is 8% instead of 9%. Now your EMI will be Rs. 15,668 and your total interest paid would be Rs. 64,055, which is higher than the previous example.

You must compare the numbers this way to get the lowest EMI possible. Using an online personal loan calculator can help you with determining what kind of loan amount and rate of interest are the best fit for your budget.

Interest Rates for Different Kind of Applicants

→Personal Loan Interest Rates For Salaried

Current personal loan interest rates in banks for salaried individuals working in reputed organizations are usually more affordable than that for self-employed individuals. That is because the risk associated with them is lower than self-employed.

Also Check Personal Loan For Salaried Employee 

→Personal Loan Interest Rates For Self-employed

Personal loan interest rates are higher for self-employed individuals. The main reason for that is the risk associated with their profession. Their income is more fluctuating than salaried applicants.

Also Check Personal Loan for Self Employed

→Personal Loan Interest Rates For Government Employees

Many banks have special schemes and best personal interest rates for government employees and pensioners. That is because government employees have fixed and secure income. Their job is also secure; hence the risk in lending money to them is low.

Check Personal Loan For Government Employees in detail.

→Personal Loan Interest Rates for Women

Most banks offer concessions (usually 0.50 bps on applicable rates) on personal loan interest rates for women to support women empowerment and provide financial support in need.

How to Get Lowest Interest Rate on Personal Loan?

Following are some tips to get low personal loan interest rates in India

  • Improve Your Credit Score: Having a high credit score makes you a creditworthy borrower in the eyes of lenders. Lenders offer low personal loan rates to applicants with a high credit score. Check your credit score before applying for the loan and improve it if it is below 750. Having a credit score over 750 increases your chances of getting a personal loan at a low interest.
  • Don’t Miss or Default Repayments: Missing or defaulting your loan EMI or credit card bill can adversely affect your credit score. Banks and NBFCs usually take your existing or past repayment history into consideration before deciding the interest rate of a new personal loan. Repay your EMIs and credit card bills (if any) on time. You can also opt for auto-debit facility if you re forgetful.
  • Keep Checking Offers: Many personal loan providers usually launch special schemes with low interest rate and processing fee waiver during festive occasions. Check for the running offer before applying for a loan to get a lower loan interest.
  • Compare Interest Rates: Compare the personal loan interest rates of various banks and NBFCs before applying to a particular lender for a personal loan. This will help you get a personal loan at a competitive rate of interest.
  • Use Your Negotiation Skills: If you have an existing relationship with the lender, you can negotiate for a cheapest personal loan interest rate. No bank will want to lose an old reputed customer.

Additional Info: Know details of Personal Loan Customer Care of Different Banks

Navi Personal Loan @9.9% p.a

Now get Navi personal loan of Rs. 10,000 to Rs. 20 Lakhs at lowest interest rate starting from just 9.9% per annum. Repay in easy instalments of 3 to 72 months. The processing fee ranges from 2.5% to 6% of the sanctioned limit + GST.

Personal Loan Interest Rates FAQs

✅ How to get low interest rates on Personal Loans?

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Many factors are involved in getting a Personal Loan with lower interest rates. Some of the factors include repayment of the debt on time, checking and rectifying the credit report, maintaining a good credit score, and repaying existing loan EMIs on a regular basis.

✅ Which bank has the lowest interest rate for personal loan?

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Looking at the current personal loan interest rates, at present, the NAVI offers the lowest personal loan interest rates starting from as low as 9.9% p.a. 

✅ What is the maximum amount of loan I can get?

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You can avail a maximum personal loan amount of Rs. 50 Lakhs. Every bank has its own personal loan limit.

✅ What are the charges for personal loan?

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Personal loan processing charges may vary between 0.50% and 2% of the sanctioned loan amount. In addition to processing fees, there are various other charges associated with personal loans that may vary from lender to lender.

✅ What is the current interest rate for personal loans?

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At present, personal loan interest rates start from 9.9% p.a. Rate of interest is determined by different banks depending on the borrower's credit score, income, loan amount, and other factors.

✅ How to ensure that one has selected the perfect repayment tenure for the Personal Loan?

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One chooses an ideal repayment tenure for a Personal Loan on the basis of many factors such as monthly budget calculation, interest rate, future financial planning and prospects, the existing liabilities, career goals, and so on.

✅ How is Personal Loan interest rate calculated?

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The personal loan rates are determined based on factors like the amount being borrowed, monthly income, the credit history, age of the borrower, and so on. Most of the time lenders prefer applicants who have the good credit score and who timely pay their EMIs.

✅ How do I decide which is the best bank to take Personal Loan from?

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Compare interest rates, processing fees, foreclosure charges, ease of applying for the loan and benefits of each lender before selecting the bank and choose the one that offers the best deal.

✅ What is the importance of CIBIL score for the Personal Loan?

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Higher the credit score, higher are the chances to get a loan application approved and vice versa. CIBIL score ranges from 300 to 900. A score of 700 and above is considered to be a good score to get a Personal Loan sanctioned.

✅ Can I take a joint Personal Loan with my spouse?

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Yes, you can apply jointly with a co-applicant (spouse or parents). This will help you to increase the eligibility and you can also get the loan of a higher amount as the income of your co-applicant will also get clubbed while calculating the eligible loan amount.

✅ If I default on my Personal Loan, will it have an impact on my co-applicant?

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Yes, if you fail to pay the loan on time then it will have the repercussions on the co-applicant as well. The default in the loan will adversely affect their CIBIL rating and score.

✅ Is a bank account required to service a Personal Loan?

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Yes, you need to have at least one functional bank account in your name. It is better to have an account with the same bank you are applying for the loan.