Personal Loan Interest Rate
Last Updated : Jan. 15, 2025, 3:02 p.m.
The key to a hassle-free personal loan journey is to choose the lender that offers you the lowest interest rates. After all, the rate determines the cost of your borrowing. Lower the rate lesser will be the interest outgo and vice-versa. We have made it easy for you to choose the best interest rate deal by showcasing the personal loan interest rates of different lenders. All you need is to compare the rates and choose the best one for you.
All Banks Personal Loan Interest Rates 2025
| List of Banks/Lenders | Personal Loan Interest Rates |
|---|---|
| Axis Bank | 11.00% Onwards |
| Bajaj Finserv | 10.00% - 31.00% p.a |
| Bank of Baroda | 11.40% - 18.75% |
| Bank of India | 10.85% Onwards |
| Bank of Maharashtra | 10.00% Onwards |
| Canara Bank | 9.25% |
| Central Bank of India | 12.00% - 12.75% |
| HDFC Bank | 10.85% - 24.00% |
| ICICI Bank | 10.85% - 16.65% |
| Federal Bank | 11.49% - 14.49% |
| IDBI Bank | 10.60% - 13.35% |
| IndusInd Bank | 10.49% Onwards |
| Kotak Mahindra Bank | 10.99% Onwards |
| Indian Bank | 10.75% - 14.75% |
| Punjab National Bank (PNB) | 11.40% - 16.95% |
| SBI | 11.45% - 14.60% |
| Standard Chartered Bank | 11.49% Onwards |
| YES BANK | 11.25% - 21.00% |
| TATA Capital | 11.99% Onwards |
| SMFG India Credit | 13.00% Onwards |
| Karnataka Bank | 12.00%Onwards |
| Union Bank of India | 11.75% - 15.45% |
Top Banks Personal Loan Interest Rates in India 2025
Below are the details of some of the best personal loan banks in India. With the help of these details, a borrower can choose which bank gives the lowest interest rate for a personal loan .
Personal Loan Interest Rate HDFC
HDFC Personal Loan is easy to get and has less documentation. HDFC Personal Loan Interest Rate is one of the lowest interest rates available in the market with the range of 10.85% - 24.00% per annum. The bank charges a minimal processing fee and offers flexible repayment options. The personal loan scheme of HDFC bank also offers life protection cover of up to INR 8 lakhs for accidental hospitalization and up to INR 1 lakh for death or permanent disability of the loan borrower.
Personal Loan Interest Rate ICICI
The personal loan of ICICI bank can be availed by any individual who has a good source of income. The loan amount that a person can get is dependent on the repayment capacity and the income profile of the bank. ICICI Personal Loan Interest Rates are fixed rate of interest which is on a monthly reducing basis. The interest rates on a personal loan ranges from 10.85% - 16.65% per annum. There is a simple payment option through ECS, AD or PDC for the customer to choose the payment mode as per their convenience.
To get a personal loan from ICICI bank, there is no security required and hence the loan approval is easy with less documentation included.
Personal Loan Interest Rate SBI
State Bank of India has several personal loan schemes keeping in mind people from all strata of society. SBI Personal Loan Interest Rates are one of the lowest personal loan interest rates and variable as per the requirement of the customer. The personal loan schemes of SBI along with their details are as follows:
Xpress Credit Personal Loan: This personal loan SBI scheme is available to fulfill all kinds of financial needs be it a personal one or a professional one. Any salaried employee working in a reputed organization can avail this loan facility. The interest rates offered under this scheme starts from 11.45% - 12.95% p.a.
Xpress ELITE Scheme : This scheme is offered by the lender to those who are either having a salary account in SBI or another bank. The rates offered by SBI under this scheme range between 11.45% – 11.95% per annum, based on the credit score of the applicant.
SBI Xpress Credit for Non-permanent Employees
Non-permanent employees (NPEs) of Central and State Government, Quasi-government, State & Central PSUs, defense personnel and educational institutions of national repute can get the loan at 11.60%-14.10% per annum.
Pre-approved Personal Loan
You can get a pre-approved personal loan based on your existing relationship with SBI, be it in the form of savings/fixed deposit account or a credit card. The rate of interest stands at 14.10% - 14.60% per annum.
Personal Loan Interest Rate Axis Bank
Be it any personal or professional need, Personal loan Axis Bank can be taken for any unforeseen financial need. Axis Bank personal loan interest rates starting at 11.00% onwards per annum. The loan can be taken by any salaried individual with a wide range of loan amount option facility. The simple loan application procedure and easy documentation make Axis Bank personal loan an attractive one.
Which Bank is Best for Personal Loan
When it comes to availing a personal loan, usually a question, i.e. which bank is the best for personal loan comes in the mind of many. However, in order to keep you away from this dilemma, we are here to help by letting you know about the top lenders, offering you the best personal loans deal. All you need to do is just read the page above, compare different lenders and then decide which one is offering you a lucrative deal.
However, if you are finding it difficult to find out, i.e. which bank gives the lowest interest rate for a personal loan, don’t worry as we are here to help. Don’t forget to choose a lender after comparing many banks not only on the interest rates parameter but on other factors as well. Yes, apart from rates, keep in mind- tenure, fee, charges, loan amount, EMI etc. for grabbing the best deal. However, for your better understanding, on this page, we have explained everything so that it would be a hassle-free journey for you to know the updated personal loan interest rates.
Which Type of Personal Loan Interest Rate Should You Go for?
Lenders provide personal loans at interest rates either on a flat or reducing balance basis. In the flat rate, the interest will be charged on the total principal amount irrespective of the payment you do via Equated Monthly Installments (EMIs). Whereas, with a reducing balance, the interest rate will apply on different amounts based on the EMIs you pay. There are commonly two types of reducing balance rates that lenders have for you – annual and monthly reducing balance.
In the annual reducing balance system, the interest rate will apply on the principal outstanding at the end of every year. Whereas, in a monthly reducing balance method, the interest rate will apply to the outstanding balance left after each EMI payment. Mathematically speaking, the reducing balance method is better than the flat rate if you want to reduce interest obligations. Within the reducing balance. If you have a choice to make, go for a monthly reducing balance to save more interest.
Factors Affecting Personal Loan Interest Rates
For a personal loan, banks and NBFCs have set certain criteria based on which they offer the interest rates to the loan seeker. Here are the factors on which the personal loan rates are offered.
Loan Amount – The most important thing that banks consider is the loan amount requirement of the borrower. As the loan amount is calculated based on the income and of the borrower and the category of the company they are working with. Hence, the higher the income of the applicant, the higher the loan amount he/she can take. Personal loan interest rates usually reduce with the rise in the loan quantum.
Tenure – The interest rate is directly dependent on the tenure of the loan. The longer the tenure, the lesser the offered rates will be.
Income of the Borrower – The earnings you have will greatly dictate the personal loan interest rates you will get eventually. A good earning with a regular flow of income will convince the lender that you can pay the loan EMI on time. Such an impression will ensure lower interest rates for you.
Repayment Capacity – The repayment capacity of the individual plays a vital role in determining the interest rates. If the borrower has no other financial liabilities, lenders consider that the loan repayment of the borrower is good. As he/she can easily repay the loan without any default in the future.
Credit Score – Not only does your credit score have a bearing on the loan amount. But also the interest rate you will get from the lender. So, if you have a credit score of more than 750 with no spot of default. The rate can be much lower.
The Type of Company You’re Working at:- The reputation of your workplace also decides greatly the rate of interest you will get on your loan. If you are working in a top-notch company, the lender can think of easing the interest rate. Working in such firms ensures a regular flow of income, which is important to pay the loan dues on time.
Here are some of the important features that make a personal loan a well-wisher for all kinds of financial needs.
Personal loans are unsecured loans and easy to get
There is less documentation in a personal loan process as there is no security needed
The borrower is free to use the money to fulfill any financial needs (personal or professional)
The easy repayment makes it more attractive as the borrower can choose the loan tenure as per their comfort
A personal loan helps in the times when there is an urgent need for a huge amount of money
Both salaried and self-employed professionals can take a personal loan
The loan amount and interest rates are calculated on the basis of the profile of the borrower. Hence, the better the income profile of the borrower, the higher is the possibility of getting a higher loan amount.
Low processing fee and prepayment charges
There is a flexible tenure on a personal loan
What is the Best Personal Loan Interest Rate When Doing a Balance Transfer?
A balance transfer is a process by which you can transfer the existing personal loan to another lender at a lower rate of interest. But when will you benefit the most with a personal loan balance transfer? It will depend on getting the best interest rate. Now, the definition of the best rate can vary when you do a balance transfer. For example, a personal loan at an interest rate of 13% might sound appealing. But you need to see how much lower that 13% is compared to the existing rate. The gap should be a minimum of 4%-5%, plus the loan must have some 2-3 years left. Since the balance transfer comes with a fee, having a much lower interest rate makes sense. An example below will help you understand it better.
Example – Manoj and Shashi have been servicing a 5-year personal loan of INR 6 lakh each. They have been paying the EMI of INR 14,912 at an interest rate of 17% per annum. Both Manoj and Shashi have got balance transfer deals after paying the EMI on time for two years. But there’s a difference between these two deals in terms of the interest rate. While Manoj gets it at 12%, Shashi has a 15% offer. How will the balance transfer pan out for them should they agree to their respective deals? Let’s find out!
| Loan Aspects | Manoj | Shashi |
|---|---|---|
| EMI Paid at 17% for 2 Years | INR 14,912 | INR 14,912 |
| Interest Payable at 17% for 5 Years | INR 2,94,693 | INR 2,94,693 |
| Interest Paid at 17% for 2 Years | INR 1,76,121 | INR 1,76,121 |
| Outstanding Balance After 2 Years | INR 4,18,244 | INR 4,18,244 |
| EMI Payable on a Balance Transfer | INR 13,892 | INR 14,499 |
| Interest Payable on a Balance Transfer | INR 81,857 | INR 1,03,704 |
| Interest Paid Till 2 Years + Interest Payable on a Balance Transfer | INR 2,57,978 | INR 2,79,825 |
| Savings on a Balance Transfer | INR 36,715 (2,94,693-2,57,978) | INR 14,868 (2,94,693-2,79,825) |
In the above table, you can see reasonably high savings for Manoj. Whereas, the savings for Shashi is quite low. There will be a balance transfer fee too. If that is factored in, Shashi will save even less.
How to Reduce the Effect of High Personal Loan Interest Rate with a Prepayment?
If you have taken a personal loan for emergency purposes, chances of you taking it without considering the interest rate can be high. In case the interest rate is high. The interest obligations can be significantly more compared to when you choose a lower rate. But you can minimize the interest payment. If you save from your routine and prepay the loan before its original tenure. Let’s consider an example to understand it better.
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 Aspects | Amount |
|---|---|
| Interest Payable on INR 5 lakh at 20% for 5 Years | INR 2,94,817 |
| Interest to be Paid Till 3 Years | INR 2,37,165 |
| Outstanding Loan Balance After 3 Years | INR 2,60,275 |
| Savings After Paying the Outstanding Balance of INR 2,60,275 | INR 57,652 (2,94,817-2,37,165) |
The lender will most likely charge a fee on prepayment, which can be anywhere around 2-5% of the outstanding loan balance plus applicable taxes. If it is 3% plus 18% Goods and Services Tax (GST) in your case, how much will you pay? If we calculate, the prepayment fee comes as INR 9,213.74 (approx.). we deduct it from the savings pointed out in the table above, the resultant savings come as INR 48,438.26.
Frequently Asked Questions (FAQs)
