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Personal loan interest rates March 2024: Which bank is offering lowest interest rate on personal loans?
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5 min read | Updated on May 21, 2024, 19:15 IST
SUMMARY
Personal loan interest rates, which depend on creditworthiness and market conditions, can be fixed or variable. Comparing rates, fees, and terms from different lenders is crucial to minimise borrowing costs. Proper documentation is required for approval.
Guide to choose best personal loan in 2024
Personal loans are a popular way to finance unexpected expenses. But with a wide range of interest rates offered by lenders, securing the best deal can be tricky. Here we present to you the current personal loan interest rate landscape in 2024. The personal loan interest rate is the percentage of total money borrowed that one must pay in exchange for borrowing; it is determined by lenders who consider different factors to arrive at the creditworthiness of the borrower, his/her credit score, as well as what is being offered in the market at any given time.
Personal loans are loans that do not require collateral or security and that can be acquired with minimal documentation provided to the lender; the money borrowed is applicable for any genuine financial need.
Types of Interest Rate
Personal loan interest rates can be either fixed or variable. Normally, fixed rates last for the entire loan time, providing predictable month-to-month payments. Variable rates, on their part, are swayed by market changes. In most cases, personal loan borrowers with more credit score ratings than others expect to pay much less interest. To obtain the best terms, it is necessary to compare the rates of personal loans borrowed from various banks to minimise the overall borrowing cost.
Personal loan interest rates March 2024
| Name of Lender | Interest rate (per annum %) | EMI (Rs) Loan amount- 5 lakh Tenure - 5 years | EMI (Rs) Loan amount- 1 lakh Tenure - 5 years | Processing fee |
|---|---|---|---|---|
| HDFC Bank | 10.50 onwards | 10,747 onwards | 2,149 onwards | Up to Rs 4,999 |
| Tata Capital | 10.99 onwards | 10,869 onwards | 2,174 onwards | Up to 5.5% |
| State Bank of India | 11.15-15.30 | 10,909-11,974 | 2,182-2,395 | NIL |
| ICICI Bank | 10.80 onwards | 10,821 onwards | 2,164 onwards | Up to 2.50% |
| Bank of Baroda | 11.05-18.75 | 10,884-12,902 | 2,177-2,580 | Up to 2% (minimum Rs 1,000 and maximum Rs 10,000) |
| Axis Bank | 10.49 onwards | 10,744 onwards | 2,149 onwards | Up to 2% |
| Kotak Mahindra Bank | 10.99 onwards | 10,869 onwards | 2,174 onwards | Up to 3% |
| Bank of India | 10.75-14.75 | 10,809-11,829 | 2,162-2,366 | Up to 1% (Maximum Rs 5,000) |
| Canara Bank | 10.95-16.40 | 10,859-12,266 | 2,172-2,453 | 0.50% (Maximum Rs 2,500) |
| Punjab National Bank | 10.40-17.95 | 10,772-12,683 | 2,144-2,537 | Up to 1% |
| HSBC Bank | 9.99-16.00 | 10,621-12,159 | 2,124-2,432 | Up to 2% |
| Federal Bank | 11.49 onwards | 10,994 onwards | 2,199 onwards | Up to 3% |
| Union Bank of India | 11.35-15.45 | 10,959-12,013 | 2,192-2,403 | Up to 1% (Maximum Rs 7,500) |
| Bajaj Finserv | 11.00 onwards | 10,871 onwards | 2,174 onwards | Up to 3.93% |
| Punjab & Sind Bank | 10.75-13.50 | 10,809-11,505 | 2,162-2,301 | Up to 1% |
| South Indian Bank | 12.85-20.60 | 11,338-13,414 | 2,268-2,683 | Up to 2% |
| UCO Bank | 12.45-12.85 | 11,236-11,338 | 2,247-2.268 | Nil |
| IDFC First Bank | 10.75 onwards | 10,809 onwards | 2,162 onwards | Up to 3.5% |
| Bank of Maharashtra | 10.00-12.80 | 10,624-11.325 | 2125-2265 | 1% (Rs 1,000-Rs 10,000) |
| Karnataka Bank | 13.43 | 11,487 onwards | 2,297 onwards | Up to 2% of loan amount (Min. Rs 2,500 & Max Rs 8,500) |
| IndusInd Bank | 10.49 onwards | 10,744 onwards | 2,149 onwards | Up to 3.5% onwards |
How To Compare Personal Loan Interest Rate?
It is vital to think about factors other than interest rates when considering personal loan options. Key points to remember are as follows: Interest Rates: The interest rate is not the only factor. Look for the lowest rate by comparing various offers. Loan Amount and Duration: Ensure the loan amount meets your needs and the repayment period is comfortable for you. Longer tenures mean lower monthly payments but more interest. Fees and Charges: Watch out for processing fees, prepayment penalties, late payment fees, and other charges. Eligibility Requirements: Check if you meet the lender’s criteria for credit score, income, and employment. Repayment Options: Some lenders offer flexible repayment plans, such as skipping a payment or extending the loan term. Customer Service: Consider the lender’s reputation for customer service, especially if you need help managing your loan. Credit Score Impact: Applying for multiple loans can affect your credit score. Compare offers carefully before applying. Extra Perks: Some lenders offer additional benefits like credit score monitoring or insurance options.
Personal Loan Interest Calculation with Example
The formula used to calculate the EMI is: EMI = 𝑃×𝑅×(1+𝑅) 𝑁/(1+𝑅) 𝑁−1
| Variable | Description |
|---|---|
| EMI | Equated Monthly Instalment |
| P | Principal amount of the loan |
| R | Monthly interest rate |
| N | Number of monthly instalments |
| I | Annual interest payable |
Carefully evaluating all aspects of personal loans, including interest rates, fees, and repayment terms, ensures you find the most suitable and cost-effective option for your financial needs. Thorough preparation and comparison can significantly impact overall loan satisfaction and affordability
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