| Particulars | Interest Rate and Other Charges Applicable |
|---|---|
| Interest rate | 10.65% to 21% p.a. |
| Processing fee | 0 to 5% of personal loan amount |
| Type of interest rate | Fixed or floating |
| Loan amount | Rs.1 lakh to Rs.30 lakh |
| Loan tenure | 1 to 5 years |
| Preferred credit score | 750 or above |
| Pre-closure fee | NIL to 4% of principal outstanding loan amount |
| Interest on late payment | 24% p.a. |
| Amortization schedule charges | Rs.200 to Rs.250 for each schedule along with applicable GST |
| Foreclosure or pre-payment statement charges | 0 to Rs.100 along with applicable GST |
| Loan cancellation charges | 0 up to Rs.3,000 (Sometimes, a customer will be asked to pay interest from loan disbursement date until loan cancellation date |
| Repayment mode swap charges | Rs.500 along with applicable GST |
| Duplicate No Objection Certificate (NOC) or No Due Certificate (NDC) | For each NOC: 0 up to Rs.500 For each NDC: 0 up to Rs.200 (Along with applicable GST) |
| Account statement charge | Rs.200 to Rs.250 plus applicable GST |
| EMI bounce charge | Rs.400 to Rs.450 plus GST |
| Duplicate prepayment statement charges | Rs.200 plus GST |
| Stamping charges | At actuals |
Personal Loan Interest Rates from Top Indian Banks
| Bank Name | Personal loan interest rates |
|---|---|
| Aditya Birla Finance Personal loan | 11.00% to 13.75% |
| Capital First Personal loan | 12% to 18% |
| CitiBank Personal loan | 10.99% to 16.99% |
| Fullerton Personal loan | 12.49% to 33% |
| HDBFS Personal loan | 13.99% to 16.99% |
| HDFC Bank Personal loan | 10.99% to 20.75% |
| ICICI Bank Personal loan | 10.99% to 17.99% |
| IndusInd Personal loan | 11% to 16% |
| India Infoline Finance Ltd | 13.49% to 19.99% |
| Kotak Personal loan | 10.99 to 17.99% |
| Oriental bank of Commerce | 10.65% to 11.65% |
| Standard Chartered Bank Personal loan | 11.49% to 14.49% |
| Tata Capital Personal loan | 11.50% to 17.25% |
Factors Affecting Personal Loan Interest Rates
Getting a personal loan is very simple and quick. You need not specify your intention for taking a personal loan. Also, your lender will process your personal loan in a very short period of time without causing much trouble to you.
Your personal loan interest rates can be impacted by numerous factors:
- Your credit history and credit score: A very significant element that plays a significant role in determining your personal loan interest rate is your credit score. This is arrived at by checking your credit history and credit-related behavior. If you have displayed discipline and promptness in paying your full loan, then your credit history, as well as credit score, will be positive. To receive an impressive credit score, you will need to make sure you pay each and every installment for your loan or credit card on time. This will help you have a decent credit score and then your interest rate for your new personal loan will be good.
In India, a good credit score is a score that is higher than 750. The score ranges from 300 to 900 where 300 is the lowest limit and 900 is the highest limit.
- Your income: If you meet the minimum income criteria imposed by your bank or NBFC, you will receive a good interest rate for your loan. When you earn a high salary at the company that you work for or at the company that you own, your lender will be of the opinion that you will be able to repay your loan without any difficulty. Lenders prefer applicants who will not miss out on any payment. When you provide relevant documents as proof of income, your lender will be able to believe in your competency to repay. You can discuss with your bank or NBFC representative for a good interest rate by showing your income.
If you have been moving jobs, make certain that you apply for a personal loan after a gap. It is important that you show a steady flow of income while applying for a new loan.
- Your relationship with your bank or NBFC: When you apply for a new personal loan, try approaching a bank or NBFC that you have already taken a loan from. You could also go to a bank where you already have a bank account or a savings deposit. You would have established a good relationship with representatives at this bank. This will help you secure a good interest rate for your personal loan. Also, your bank would be ready to make adjustments to give you an impressive interest rate to retain you as a customer. Hence, make sure you are a loyal and disciplined customer by making all payments on time.
- Your employer’s reputation or goodwill: A lender also checks the company that you are working at. If you are an employee at any of the top organizations in the country, you will get a good interest rate. When you are working at any start-up company or a recently established company, your lender may assume that your income flow may not be that regular. Hence, your lender may charge a high-interest rate. In such cases, you can give proper assurance to your lender that you will be able to repay your loan on time.
- Your negotiation skills: If you meet the personal loan eligibility criteria properly, you can utilize your personal negotiation skills to receive a waiver or a discount on your interest rates by discussing with your lender. You can give relevant explanations to your lender and then obtain waivers on processing fees and interest rates.
Types of Interest Rates
In India, there are chiefly 2 types of interest rates and they include fixed or flat rates and floating or variable rates. Under fixed interest rates, your interest rate will be fixed or locked for the entire loan period. Whether the rate increases or decreases, your rate will remain the same. On the other hand, with a floating or variable interest rate, your rate will depend on the fluctuations in the market.
Personal Loan Flat or Fixed Interest Rate
Under this interest rate system, the interest rate does not change even a bit during the full loan period. It is fixed by the lender as per his or her assumptions regarding the average discount rate over the entire loan tenure. A fixed rate personal loan capital value is fixed as per the future interest rates that are arrived at during the computation process.
Personal Loan Reducing or Variable Interest Rate
A personal loan with a variable or reducing interest rate has a rate that changes on a regular basis. This happens as it changes according to the benchmark interest rate that fluctuates over a period of time. When the benchmark interest rate goes down, it is very helpful to a borrower.
How to Get Better Interest rates on Personal Loans
Before you finalize on anyone personal loan option, you can follow a few simple guidelines to get better interest rates than the ones that have already been offered to you.
- Make a proper comparison of the various loan options: Most banks and NBFCs provide multiple personal loan schemes. You can use third-party financial websites and official websites of banks to make your comparisons. This way, you can pick one with a decent interest rate.
- Get the help of a co-applicant if you have a bad credit score: If you have a poor credit score, you need not worry that your personal loan interest rate will be very high. You could take the help of a co-applicant or a guarantor to assure the bank that you will repay your loan on time in spite of your bad credit history. Most personal loans do not require a guarantor. However, if you request for making special arrangements, your lender may agree to give you a good loan when you have a co-applicant by your side.
- Clear all your previous dues: Before you apply for a personal loan, make sure that you pay off all your credit card dues and your outstanding amounts of other loans. This way, you can negotiate with your lender and get an excellent loan deal. When your lender makes a random credit check, he or she will get to know that you have made a late payment or that you missed a few payment deadlines. If you do not have any such records, you will get a decent interest rate for your personal loan.
- Go for a secured personal loan if you have bad credit history: This is a less-preferred option. Most people choose personal loans since they are unsecured. However, if you have a bad credit history and if your lender is charging a very high-interest rate, you can then offer an asset to your lender as a security or a collateral. This will help you get a reasonable interest rate.
