Personal Loan Interest Rates 2021: Top 5 Banks Offering Lowest Personal Loan Interest Rates | Photo credit: iStock Images
New Delhi: With a personal loan, you can enjoy the freedom to borrow and spend to achieve all of your goals hassle-free. You can get your loan disbursements in a day and invest in home renovations, children’s education, medical procedures, and more. Although it has become easier than ever to avail small loans online, the personal loan interest rate is one of the critical factors you need to consider.
It takes about 2-7 days for the disbursement of personal loans if the application is successful. Some lenders can approve the loan amount faster in case of pre-approved loans. The personal loan application process is easy to complete and you can get your application approved quickly. All you need to do is meet the personal loan eligibility criteria mentioned on the lender’s website and submit your basic documents.
Personal loan amount:
The maximum amount of a personal loan depends on your monthly income. In India, some lenders offer up to Rs 50 lakh depending on income, credit history and credit score. If you get money to pay off the loan before the end of the term, you can easily do so. This is called a prepayment. Each prepayment you make will reduce your loan principal outstanding, which will also reduce interest charges.
Personal loan interest rates:
Although it is easy to borrow and repay a personal loan, many people avoid getting one because the interest rate on these loans is extremely high. For personal loans, the interest rate is usually between 10-24% per annum and is usually decided based on factors such as credit profile, payment history, job profile of the applicant, employer profile, etc.
Banks offering the lowest interest rates on a personal loan of Rs 5 Lakh for a term of 5 years:
| Bank | Interest rate |
| Union Bank of India | 8.90% |
| central bank of india | 8.90% |
| National Bank of Punjab | 8.95% |
| Indian bank | 9.05% |
| Bank of Maharashtra | 9.45% |
(Source: BankBazaar)
Remember that whether you are self-employed or employed, your monthly income is a key factor when applying for a personal loan online. Your credit score also matters when it comes to the interest charged on your online personal loans.
Moreover, the reputation of your employer is also important in deciding the terms of the online personal loan. Apart from your overall credit score, lenders also look at your previous repayment history and decide the loan interest rate.
