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Personal Loan Interest Rate

List of Personal Loan Interest rates across all banks in India

Personal Loan issuers in India

The Personal loans are offered by banks and financial institutions to individuals based on their employment history, repayment capacity, income level, and credit history. In other words, a personal loan is an unsecured loan that allows you to borrow a fixed amount of money from a bank, NBFC, or a lender without any collateral. Personal Loan Interest Rates from banks and NBFCs are available at competitive rates, quick disbursal, and minimal documentation. This makes these loans attractive for individuals in times of personal contingencies.

Current Personal Loan Interest Rates - July 2025

The following table enlists the personal loan interest rate along with the processing fees for banks.

Bank	Interest Rate	Loan Amount	Processing Fees
State Bank of India	10.10% p.a to 15.10% p.a	Up to 35 Lakhs	Up to 1.50% of the loan amount
HDFC Bank	10.9% p.a to 24% p.a	Up to 40 Lakhs	Rs. 6500 + GST
Axis Bank	9.99% p.a to 22% p.a	Up to 40 Lakhs	2% of the loan amount + GST
ICICI Bank	10.60% p.a to 16.50% p.a	Up to 50 Lakhs	2% of the loan amount + GST
Union Bank of India	10.30% p.a to 14.40% p.a	Up to 50 Lakhs	0.50% of the loan amount with a minimum of Rs.500 + GST
Bank of Baroda	10.90% p.a to 18.25% p.a	Up to 20 Lakhs	2% of the loan amount + GST (Min Rs.1000, Max Rs.10,000)
IDFC First Bank	9.99% p.a to 38% p.a	Up to 10 Lakhs	2% of the loan amount + GST
IndusInd Bank	Starting from 10.49% p.a	Rs.30,000 to Rs.5 Lakhs	Up to 3.5% of the loan amount
Yes Bank	10.85% p.a to 21% p.a	Up to 50 Lakhs	Up to 2.5% of the loan amount
Punjab National Bank	Starting from 10.60% p.a	Up to 20 Lakhs	0.5% to 2.5% of the loan amount
Aditya Birla Capital	Starting at 10.99% p.a	Up to 40 Lakhs	4% of the sanctioned loan amount
Bank of India	Starting at 11.10% p.a	Up to 25 Lakhs	0.50% to 1% (Min Rs.500, Max Rs.15,000)
Kotak Mahindra	Starting at 10.99% p.a	Up to 35 Lakhs	5% of the final loan amount + taxes
Shriram Finance	Starting at 11% p.a	Up to 10 Lakhs	5% of the sanctioned amount
L & T Finance	Starting at 11% p.a	Up to 30 Lakhs	Up to 3% of the loan amount + applicable taxes
Federal Bank	12% p.a to 22.5% p.a	Up to 5 Lakhs	1.5% to 2.5% of the loan amount
Tata Capital	Starting at 11.50% p.a	Up to 35 Lakhs	Up to 3.5% of the loan amount + GST
Hero FinCorp	Starting @1.58% per month	Up to 5 Lakhs	2.5% of the loan amount + GST
DBS Bank	10.99% p.a to 30% p.a	Up to 15 Lakhs	3% of the loan amount + GST
SMFG India Credit	Starting at 13% p.a	Up to 30 Lakhs	5% of the loan amount + GST
Bandhan Bank	Starting at 9.47% p.a	Rs.50,000 to Rs.25 Lakhs	3% of the loan amount + GST
IDBI Bank	Starting at 11.00% p.a	Rs.25,000 to Rs.5 Lakhs	1% of the loan amount (min Rs.2,500)
City Union Bank	9.75% to 12.50%	Up to Rs.5 Lakhs	0.50% of the loan amount
RBL Bank	18% p.a	Up to Rs.5 Lakhs	2% of the loan amount

Fees and Charges

The fees and charges that are applicable for personal loans are listed below. They are:

Particulars	Rate
Processing Fees	Usually 0.5% to 3% of the loan amount
Prepayment/Foreclosure Charges	2% to 5% of the outstanding principal
Part Payment Charges	1% to 3% of part paid amount
Late Payment Charges	2% to 4% of the overdue amount
Loan Cancellation Charges	Rs.1000 to Rs.5000
Stamp Duty & Other Statutory Charges	Differs between states
EMI Bounce Charges	Rs.500 to Rs.1000 per bounce
Duplicate Statement Charges	Rs.200 to Rs.500 per request
Verification Charge	Around Rs.500 to Rs.1000
EMI Payment Penalty Charges	Usually, 2% to 3% of the EMI overdue amount
EMI Bounce Charges	Up to Rs.450 per instance
Cheque Bounced Charges	Rs.500 to Rs.750 per instance

Factors Affecting Personal Loan Interest Rates

Various determining factors affect the personal loan interest rates. They are:

Credit Score: The credit score is one of the predominant factors that determines your utmost financial discipline. Lenders use it to determine the risk involved in lending to a particular customer. A higher credit score will lead you to favorable interest rates. This can be used as a buffer to understand the risk involved.

Income and Employment Stability: Your income and employment play a significant role in bagging a competitive personal loan interest rate. The lender wants to assess whether you have a stable income month on month to pay your EMI. Working with a reputed organization also ensures stable employment, which in turn leads to a favorable personal loan interest rate.

Debt-to-income Ratio: This also influences your personal loan interest rate. Your total monthly debt payments to your gross income should not be more than 35%. This ensures you can manage your loan alongside your existing debts.

Having a Co-applicant: A co-applicant with a high credit score and a stable income will be a valuable addition to your loan application. This means there is a shared burden on your responsibility towards your loan. And this approach will reduce the lender’s risk.

Fixed vs Floating Interest Rates on Personal Loans

The following table encapsulates the exact differences between the Fixed and Floating interest rates on personal loans. They are:

Basis of Difference	Fixed Interest	Floating Interest
Definition	The interest rate remains the same throughout the tenure of loan	The interest rate changes based on market conditions or based on benchmark rates
Monthly EMI	Remains constant for the entire loan period	Varies throughout the term of the loan
Predictability	Highly predictable. Easier to make budgeting	EMIs will fall or rise
Market Dependency	Not affected by changes in the market rates	Fluctuates based on market conditions
Initial Rate	Higher than the floating rate of interest	Lesser rate than the fixed rates in the start
Risk Factor	Low Risk	High Risk
Benefits in Falling Rates	No benefit if market rates drop	Benefit from reduced rates when market rates fall
Top Most Merit	People who prefer stability and no surprise in EMIs	Customers who are equipped in handling fluctuations and want to benefit from potential rate drops.

How to Get the Lowest Personal Loan Interest Rate?

The following tips and tricks can be adopted to get the lowest personal loan interest rates. They are:

Lending institutions consider various attractive features based on the loan amount required from you. This includes your employment history, credit score, repayment capacity, and much more. Interest rates for personal loans are likely to be higher when compared to other loans.

Strengthen Your Credit Score: Maintaining a good credit score of 750 and above is crucial for securing a personal loan at the best interest rates.

Pay Dues on Time: You need to pay the dues on time and maintain a good repayment track record. This shows that you are a trustworthy customer.

Compare Before Committing: Compare the interest rates between lenders and round off the best interest rate possible.

Leverage Festive Offers: Lenders often offer special rates during festive seasons; consider taking out loans during these periods.

Strong Employment History: Working with a specific employer for a longer duration helps you to earn low-interest loans. A minimum of 2 years of work experience, including a one-year work experience with the current employer, is a safe period that you need to aim for.

Employer’s Credibility: Working in a reputable organization will help you to earn low-interest loans.

Key Factors to Evaluate Before Choosing a Personal Loan Interest Rate

The following are the key factors that need to be evaluated to choose a personal loan interest rate. They are:

Credit Score Matters: Your credit score will make an impact on your personal loan interest rate. A higher credit score is the key towards low-interest loans.

Loan Amount and Tenure: Your maximum loan amount and tenure makes an impact on the interest rate of your personal loan.

Type of Interest Rate: Having an understanding of fixed and floating rate of interest and evaluating their pros and cons will earn you low-interest loans.

Understand the Loan Terms: Go through the terms and conditions laid down by the lender to understand the hidden charges or penalties that will affect the interest rate.

Income and Employment Stability: A stable income and a good employment history will help you to earn a better interest rate on personal loans.

Lender Relationship: Having a positive relationship with the lender will earn you preferential personal loan interest rate.

Seasonal and Promotional Offer: Lenders always run special seasonal offers during festive season. You can end up earning a lower rate of interest during this period.

How Interest Rates Impact Your EMI and Loan Tenure

The interest rate on your personal loan plays an important role on your EMI and loan tenure.

Factor	Effect of Higher Interest Rate	Effect of Lower Interest Rate
EMI Amount	Increases. Forcing you to make heavier monthly payments	Decreases. Making the monthly payments easier to manage
Total Interest Paid	Significantly Higher over Loan Tenure	Significantly Lower over the Loan Tenure
Loan Tenure	May extend to cover higher interest cost	May reduce as interest costs are lower
Overall Loan Amount	More expensive in the long run	Makes it affordable in the long run
Financial Flexibility	Decreases due to high amount of interest payment	Increases as there is not much burden on interest payment

How Personal Loan Balance Transfer Helps Lower Interest Rates

A personal loan with a higher interest rate will feel like a burden rather than a pleasant experience. This is especially true when you are stuck with inflexible terms and conditions. However, with current trends, you can consider a balance transfer of your existing personal loan to a lower interest rate.

A balance transfer is an option exercised by you to transfer the balance of your loan to a lower interest rate with another lender with better terms and conditions or improved service.

Reduced Interest Rate: You can exercise the option of balance transfer on your loans if you want to reduce the overall payment made towards your loans. Most people exercise this option to transfer their loan to a lender offering a lower interest rate and thereby reducing the overall cost of the loan.

Reduced Monthly EMIs: A lower interest rate translates to reduced monthly EMIs. This gives you a breathing space on your monthly budget. This is ideal when your expenses have increased and your income has changed.

Make Use of Top-Up Facilities: When you are going in for a balance transfer of your existing loan to another lender, you have the flexibility to ask for a top-up facility of your loan. The lender might also be willing to give you a top-up facility for your loan.

Get Increased Repayment Tenure: When you do a balance transfer of your existing loan, you can also go for an extended repayment tenure. This means you have the option of extending your loan period and enjoying the benefit of lower EMI.

Get Better Services: Consider a loan balance transfer to enjoy enhanced services, including flexibility for online payments with standing instructions, timely EMI reminders, and regular updates, all supported by improved customer service facilities.

How RBI Rules Affect Personal Loan Interest Rates

The Reserve Bank of India plays a predominant role in deciding your personal loan interest rate. The monetary policies, rate changes, lending guidelines affects the personal loan interest rates. Heris how the RBI rules affect the personal loan interest rates.

RBI Rule	Impact on Personal Loans
Repo Rate	Any increase in the REPO rate set by the RBI will increase your personal loan interest rate. A REPO rate cut will reduce your personal loan interest rate.
Monetary Policy Decision	Tight monetary policy to control inflation can increase your loan rates. An accomodative monetary policy to boost growth will reduce your loan rates.
Regulatory Guidelines on Margins & Risk Weights	RBI can create rules as how much money that it has to keep aside when giving out personal loans.
Borrower Protection Guidelines	Rules on fair lending practices and prepayment charges can indirectly reduce the cost of borrowing

How Banks Offering Personal Loans with Low Interest

The following are some of the banks and financial institutions offering personal loans with low interest rates.

Banks	Rate of Interest
Bank of Maharashtra	9.75% to 14.30%
Indian Bank	9.75% to 15.25%
IDFC Bank	Starting with 10.25%
SBI	10.15% to 10.30%
ICICI Bank	10.60% p.a. to 16.50% p.a
HDFC Bank	10.9% p.a to 24% p.a
Axis Bank	9.99% p.a to 22% p.a
Kotak Mahindra Bank	Starting at 10.99% p.a

How to Compute Personal Loan Interest Rates?

You can compute the personal loan interest rate and the monthly EMI through the formula EMI = [PxRX(1+R)^N]/[(1+R)^N-1],

Say suppose you have got a personal loan of Rs.5 Lakhs over a period of 5 years at the interest rate of 10.10% p.a. Your EMI calculation will be as follows:

P = Rs. 5,00,000 N = 12 X 5 = 60 months R = 10.10/12/100 = .0084167

EMI = 5,00,000 X .0084167 X (1 + .0084167 ) ^ 60 / (1 + .0084167) ^ 60 – 1

EMI = Rs. 10,648/-

Say suppose you have got a personal loan of Rs. 10 Lakhs loan from HDFC for a tenure of 5 years with an interest rate of 10.60% p.a. Your EMI calculation will be as follows:

P = Rs. 10,00,000 N = 12 X 5 = 60 months R = 10.60/12/100 = 0.0088333

EMI = 10,00,000 X .0088333 X (1 + .0088333) ^ 60/ (1 + .0088333) ^ 60 – 1

EMI = Rs. 21,211/-

You can also check personal loan emi calculation through Creditmantri's Personal Loan EMI Calculator

Disclaimer: This page includes information that has been compiled from many sources and is only offered for informational purposes. Given this type of data might change over time, we cannot guarantee that the information supplied or included within it, is accurate. It is anticipated that the user would confirm with the relevant source prior to taking any choices or actions.

FAQs about Personal Loan Interest Rates:

1. What factors influence the Personal Loan Interest Rates in India?

Some of the factors that influence your loan interest rate include your credit score, repayment history, debt-income ratio, employment stability, and overall financial health.

2. How can I improve my chances of getting the lowest interest rate on personal loans?

You can improve your chances of getting low-interest personal loans by improving your credit score, avoiding new debts, making timely payments, and minimizing unwanted credit inquiries.

3. Are personal loan interest rates fixed or variable?

You get personal loan interest rates for a fixed and a floating rate of interest. If it is a fixed rate of interest, the EMI amount will be the same throughout the loan term. If it is a floating rate of interest, it may change according to market conditions. You need to review the terms and conditions before borrowing.

4. How do lenders determine the rate of interest on personal loans?

Lenders decide the rate of interest on personal loans based on your credit score, repayment capacity, and various market conditions.

5. What is a reasonable rate of interest for a personal loan?

The average rate of interest for a personal loan can vary based on your creditworthiness and lender policies. The typical interest rates on personal loans range between 9.5% p.a to 30% p.a.

5. Which bank's personal loan interest rate is the lowest?

Bank of Maharashtra offers the lowest rate of interest on personal loans, with rates ranging from 9.75% p.a. to 14.30% p.a.