A personal loan is an unsecured type of loan that is given by banks for personal expenses like home renovation expenses, holiday expenses, credit card bills, medical expenses, wedding expenses, etc. In this kind of loan, one doesn’t have to give anything as collateral security. Below is the list of updated personal loan interest rates 2020.
Personal Loan Interest Rates Comparison in India 2020
| Bank | Loan Rate | Processing Fee |
|---|---|---|
| Allahabad Bank | 13.15% | 1.06%, Min. Rs. 1068 |
| Andhra Bank | 11.60% | Rs. 400 per lakh, Min. Rs. 1000 |
| Axis Bank | 12% | 1.50% to 2.00% + taxes |
| Bank of Baroda | 11.70% | 2%, Min. Rs. 1000 & Max. Rs.10,000 |
| Bank of India | 12.90% | 2%, Min. Rs. 1000 & Max. Rs.10,000 |
| Bank of Maharashtra | 12.7% | 1%, Min. Rs. 1,000 |
| Canara Bank | 11% | 1%, Min. Rs. 250 |
| City Bank | 10.99% | Upto 0.5% |
| Corporation Bank | 10.75% | 1.5%, Min Rs. 500 |
| Federal Bank | 10% | Up to 3%, Min Rs. 500 |
| HDFC | 10.75% | Upto 2.50%, Min Rs. 2,999 & Max. Rs. 25000 |
| ICICI | 11.25% | Up to 2.25%, Min. Rs. 999 |
| IDBI Bank | 12% | 1% |
| Indian Bank | 11.05% | 0.5%, Min- Rs. 508 |
| Indian Overseas Bank | 11.90% | Up to 0.50% |
| Indusind Bank | 11.00% | Nil |
| Karur Vysya Bank | 12% | up to 1%, Min. Rs.100 |
| Kotak | 10.50% | Upto 2.5% + taxes |
| SBI | 10.50% | 1% + taxes |
| Standard Chartered | 11% | Up to 3% |
| Union Bank of India | 14.40% | 0.50% of the total Loan |
| Yes Bank | 20% | 2.50% |
Personal Loan Guide
Here are the steps to getting a personal loan.
Step 1: Fill up the application form either online or by visiting the branch office. Along with the application form, you have to give 2 passport-sized photographs and the required documents.
Step 2: After receiving the application, your credit score will be checked.
Step 3: Now the submitted documents will be verified by the verification team. They will send a representative to your home for checking the address. They will also send a representative to your office to check whether you are really working there or not.
Step 4: If the verification team gives a green signal for the further process, then the processing team will make the loan agreement having all the terms and conditions which you will be required to sign. After signing of the agreement, the loan amount will be credit in your account within 24 hours.
Documents required
| Salaried Employee | Self Employed |
| Government Approved Identity Proof like Voter’s ID, Passport, Driving License, and Pan Card | Government Approved Identity Proof like Voter’s ID, Passport, Driving License, and Pan Card |
| Address Proof like ration card, electricity bill or your passport | Address Proof like ration card, electricity bill or your passport |
| Last three months of the bank’s statement | Last three months of the bank’s statement |
| Employment certificate | Educational documents |
| Last three months’ salary slips | Business Continuity documents |
| ITR fillings | ITR fillings |
Factors affecting interest rates
Following are the factors that affect interest rates on Personal loans.
CIBIL Score
If you are having a CIBIL score of 750, then you can get the personal loan with ease. Also if you are having a score of more than 750 like say 800, then you can get the personal loan at a low-interest rate. The reason for this is that having a good CIBIL Score indicates your good repayment capacity. Hence the banks are ready to give loans to such individuals.
Income
As nothing is required to be kept as collateral for getting the loan, the bank will grant a low-interest rate loan depending on the stability of your income. If you are having a good source of income and if that income is high then you can get the low-interest rate personal loan very easily.
Company Category
The company where you work at also determines your success of getting a low-interest rate personal loan. The bank has divided the companies into 5 categories namely-
Category A- It consists of top 1000 companies.
Category B- It consists of multinational companies
Category C- It consists of smaller companies
Category D- It consists of companies having a strength of 100 employees.
Generally higher the category, easier it will be to get a personal loan having a low-interest rate.
Bank’s Old Customer
If you are an old customer of the bank then you might get a personal loan at a low-interest rate. They do this so as to retain their old valued customers.