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Punjab National Bank

Personal loans are the last resort for individuals who are unable to fund their need by other sources. Personal loans are unsecured loans, hence there is no requirement of collateral. It is also called as signature loan or multi-purpose loan. The documentation involved in this type of loan is minimal. It is extended to the applicant solely based on the credibility of the applicant. The credibility is established by means of credit score. Typically, the bank considers a credit score of 750 as a decent score for extending personal loan seamlessly.

How does a personal loan work?

Personal loan is extended by the bank as a lumpsum, it has to be paid back in installments on a monthly basis. This is called the equated monthly installments (EMI), which includes both principal and interest. The EMI is payable over the tenure of the loan which is pre-determined. Typically, the tenure will range between 1 year – 5 years. The tenure is low compared to all other forms of loan, since they are of higher risk. To compensate for the high risk, the bank charges high interest compared to other types of loans.

Factors that affect the interest rate of personal loan offered by Punjab National Bank

The below mentioned factors have an implication on the interest rate of the personal loan offered by Punjab National Bank –

  • Credit score – The credibility of the applicant is assessed by the credit score of the individual. The higher the credit score, the better are the chances for favorable interest rates. Typically, many banks prefer a minimum of 600 score for extending personal loan. A score of 750 is considered ideal and is likely to enable negotiation of favorable terms.
  • Income level – The income level of an individual is likely to impact the quantum of loan and the interest rate. A higher income level will enable the individual to borrow higher loan amount and negotiate favorable interest rate.
  • Stability of income – An elongated employment history is ideal for personal loan and favorable interest rate on the loan. The individual will be able to negotiate a lower interest rate and longer tenure on the personal loan.
  • Loan amount and duration – A higher loan amount and longer duration provides the bank with clarity of revenue for longer tenure, thus enabling the applicant to negotiate favorable terms.
  • Market interest rate – While most of the above points are still in the control of the individual, there are macro-economic factors which also determine the interest level on the personal loan. The market interest rate determines the base rate upon which the personal interest rate is determined. The interest rate on personal loan is arrived as base rate + margin. The base rate is dependent on the market interest rate trend.
  • Money supply in the economy – The market sentiment and money supply in the economy also influence the interest rate on personal loan. If the money supply is more, then the situation is favorable for the borrower, thus the interest rate are likely to be favorable for the borrower. If the money supply is less, then the situation is favorable for the lender and the lender will charge a higher interest rate.

Rate of interest on personal loan extended by Punjab National Bank

Loans up to Rs.10 lacs - For individuals whose salary is being disbursed through our branches only (Including Defense Personnel).MCLR + 3.55%
*Loans above Rs.5 lacs & up to Rs.10 lacs* - For other categories i.e., applicants not having salary account with our bank irrespective of check off facility. (*Field functionaries are not empowered to sanction these cases.)MCLR + 4.55%
Loans upto Rs.5 lac - For individuals who are availing the loan under check off facility (Including Defense Personnel)MCLR + 5.55%
For others up to Rs.5 lacsMCLR + 6.55%

A personal loan is a convenient way of raising funds for personal expenses. It does not require any collateral and usually takes little time for the loan to be processed. Interest rates for personal loans in India and elsewhere in the world are usually high, because the lenders do not have any collateral as security and safeguard their money against possible default by charging a higher interest rate.

You could use a personal loan for any significant expenditure including an expensive holiday, a wedding, buying an expensive gadget, medical treatment, or simply to tide you over a temporary financial shortfall.

The interest rate on a personal loan could range from as low as 11% to as high as 32% per annum or more. It is influenced by a variety of factors, like your credit history including your repayment track record, your credit score, your net annual income, debt-to-income ratio, employment stability etc.

Some features and benefits of PNB personal loans:

  • No restrictions on end use of loan amount
  • Multi-purpose loan
  • Flexible tenures up to 60 months
  • No security, no collateral loan, although this might depend on your credit history. Third party guarantee is accepted.
  • Loan payable in easy installments
  • Punjab National Bank loan payment options include by Standing Instruction
  • Hassle-free personal loan application and can be done online as well
  • Easy and simple documentation
  • Eligibility: Employees of central and state governments, reputed companies, educational institutions etc.

Punjab National Bank Personal Loan Interest Rate 2018: 11% to 25% p.a. (typical range)

Personal Loan Interest Rates in Punjab National Bank varies with your loan amount and if your salary account is with the bank.

Note that interest rates and other charges are subject to periodic review. Punjab National Bank Personal Loan Interest can range anywhere from 11% to 25% per annum though it can be higher, depending on your credit history amongst other factors. The final pricing will be based on your income, loan amount, loan tenure, and the bank’s internal policies and the applicable rates at the specific time. For the most up to date information on Punjab National Bank Personal Loan Rate of Interest and other associated fees and charges, it is advisable to contact the bank directly.

Loans up to Rs.10 lac -For individuals whose salary is being disbursed through PNB branches only (Including Defence Personnel) - MCLR + 3.55%

*Loans above Rs.5 lacs & up to Rs.10 lac* -For other categories i.e., applicants not having salary account with PNB - MCLR + 4.55%

Loans up to Rs.5 lac -For individuals who are availing the loan under check off facility (Including Defence Personnel) - MCLR + 5.55%

For others up to Rs.5 lac - MCLR + 6.55%

Processing charges and upfront fee on personal loan extended by Punjab National Bank

Processing chargesUpfront fee
1.80% of loan amount
Up to Rs. 2 lac- Rs. 270/-
Above Rs. 2 lac- Rs. 450/-

Punjab National Bank personal loan for public

The key features of personal loan for public are –

  • Purpose of personal loan – To meet financial needs such as medical treatments, marriage expenses, vacation, education etc.,
  • Eligibility – All salaried employees with Central Government, State Government, Public Sector Units, public and private companies, schools, colleges, Universities etc., Self-employed professionals and businessmen with an income not lower than Rs. 4 Lakhs per annum, Defense personnel including officials of Military Station Headquarters, Border Security Force, Central Reserve Police Force, Central Industrial Security Force, Indo Tibetan Boarder Police, etc.
  • Loan value – Minimum Rs.50000/-; Maximum – For all borrowers, Rs. 4 Lakhs or 20 times net salary whichever is lower subject to certain minimum net monthly salary
  • Margin requirement – Nil; Security requirement – Suitable third party guarantee is accepted
  • Repayment can be made over a maximum of 60 months.

Personal loan scheme for pensioners

The key features of personal loan scheme for pensioners is as below –

  • Purpose – Meet financial needs such as medical treatments, marriage expenses, vacation, education etc.,
  • Eligibility – All pensioners who draw pension and hold account with Punjab National Bank
  • Loan value – Minimum – Rs. 25,000; Maximum loan (can be availed upto age 70 years) – Rs. 10 Lakhs or 18 times of net monthly pension (For Defense pensioners, 20 times net monthly pension), whichever is lower; (can be availed between 70 – 75 years) Rs. 7.5 lakh or 18x their net monthly pension (20x for defense pensioners) whichever is lower; (can be availed above 75 years) Rs. 5 Lakh or 12 months of pension amount whichever is lower
  • Margin required – Nil; security – Spouse who is eligible for family pension, earning children (preferably Government employee) or third-party guarantee with net income equal or more than loan amount, acceptable to the bank
  • Repayment period – Maximum of 60 months for repayment is allowed

    There are no pre-payment charges applicable on the personal loan pre-closure.

Rate of interest on personal loan for pensioners extended by Punjab National Bank

Punjab National Bank offers extremely competent interest rates on personal loan, the interest rate applicable on these types of loans are MCLR +2.8%. The quantum of loan is not considered and the interest rate is held even across all slabs.

Processing charges and upfront fee on personal loan extended by Punjab National Bank

Personal loan to pensioners has no processing charges, and upfront fee of Rs. 500 is charged. The upfront fee is the documentation charge applicable for the loan.

Frequently asked questions- Punjab National Bank personal loan Interest Rate

1. Who can apply for personal loan from Punjab National Bank?

Personal loan can be extended to salaried, self-employed and professionals.

2. What are the modes through which one can apply for personal loan by Punjab National Bank?

There are several ways of applying for Punjab National Bank personal loan:

  • Apply directly online at the Bank’s official website
  • Personally visit nearest branch with the required documents
  • Contact the customer care department of the bank

3. What key factors determine the accessibility and interest rate of personal loan?

Among other factors, credit score, stability of income, repayment ability and reputation of employer are considered while extending the personal loan. If these aspects are strong in the case of the applicant, the applicant can avail attractive interest rate on the personal loan.

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