| Personal Loan |
| Loan Amount |
Rs. 1 lakh to Rs. 1 crore |
| Interest Rate |
10.50% onward |
| Tenure |
1 year to 5 years |
| Processing Fee |
Up to 2% of the loan amount |
| Prepayment Charges |
Up to 5% of the outstanding principal |
- A Personal Loan is an unsecured loan. It is a multipurpose loan that you can take to meet any financial requirement.
- SBI offers the lowest rate 10.50% onward followed by the HDFC bank at 10.75%. Lowest EMI per Rs. 1 lakh is Rs. 2,149.
- The loan amount available is between Rs. 1 lakh and Rs. 1 core. This product is usually offered to salaried individuals only.
- Some banks and NBFCs may offer personal loan for self-employed (architects, doctors, lawyers, and Chartered accountants), firms, and enterprises as well.
- The key benefits of a personal loan are: minimal documentation, no restriction on the end-use of the fund, quick processing and disbursal.
Features and Benefits of a Personal Loan
Below-given are the benefits and features of a personal loan:
- No Security Required: This loan is collateral-free. You can borrow up to Rs. 1 core without securing any asset with the bank/NBFC.
- Affordable Interest Rate: The personal loan interest rate starts at 10.50%. The rate of interest is much lower than interest charged (as high as 36%) on a credit card loan.
- Flexible Tenure: The tenure is flexible: between 1 year and 5 years. You can choose loan tenure as per your repayment ability.
- Quick Disbursal: The loan amount is quickly disbursed within 48 hours of loan approval. Therefore, you can choose a personal loan to fulfil urgent expenses.
- Online Application: Most lenders allow you to apply for a personal loan online. Thus, no branch visits are required to request for the funds.
Types of Personal Loans in India
Personal loans are used for multiple purposes, some of which are given below:
| Purpose of a Personal Loan |
Details |
| 1. Debt Consolidation |
To consolidate debts, such as paying off soft loans, credit card bills, other existing loans with a single personal loan. |
| 2. Big-ticket Purchases |
To purchase gadgets and electronics items such as iPhone, smartphones, laptops, computers, etc. |
| 3. Holiday or Travel Loan |
To fund expenses of a holiday tour, vacation getaway, business travel trip, etc. |
| 4. Home Renovation |
To manage expenses of home renovations and repairs. |
| 5. Wedding |
To cover the cost of events such as wedding, engagement, etc. |
| 6. Medical Emergency |
To arrange finances for medical and educational expenses. |
| 7. Education |
To handle the cost for higher education of children. |
Things to Consider before You apply for a Personal loan
Below-mentioned are things to keep in mind before you drop a personal loan application:
| Things to Consider Before Application |
Details |
| 1. Compare Banks and Financial Institutions |
Before applying for the loan, you must compare personal loan schemes across banks and NBFCs. Go through details such as interest rate, loan amount offered, eligibility criteria, repayment tenure, fees, charges, and other terms and conditions, before selecting a particular loan scheme and provider. |
| 2. Credit Score |
Your credit score must be 750+ to avail the loan. Click- > Get CIBIL Score for FREE to check your credit score for free on our website. |
| 3. Documents Required |
You have to submit income proof, identity proof, residence proof, and other necessary documents as required by the fund-provider. Keep a soft-copy of these documents with you if you are applying online. If applying offline at a branch-office, you will require xerox of the original documents. Carry the original documents for verification. |
| 4. Annual Percentage Rate (APR) |
Know APR of loans online. APR is the total cost of loan as per the annual interest. |
| 5. Other Fees and Charges |
Apart from the interest rate on the loan, you should also check for other fees and charges applicable, such as original fee, late payment charges, prepayment or foreclosure charges etc. These charges influence the total cost of the loan.
|
Personal Loan Eligibility Criteria
Below-mentioned are the personal loan eligibility norms:
| Things to Consider Before Application |
Details |
| 1. Age |
You must be above 21 years of age. |
| 2. Income |
Your net monthly income must be at least Rs. 25,000. |
| 3. Credit Score |
A credit score of 750+ is considered as a good credit score to avail the loan. |
| 4. Employment History |
Minimum work experience of 1 year is preferred. You must be able to provide income proofs. Cash salary is not acceptable. |
| 5. Ongoing EMIs |
As a thumb rule, on-going EMIs should not be more than 60% of your income. |
Documents Required for Personal Loan
Here is a list of documents needed for salaried, professional, and self-employed applicants for a personal loan:
| Documents Required |
Individuals |
Self-employed, Firms, Partnerships |
| Filled and signed application form |
It is required |
It is required |
| Proof of Identity |
PAN card, Driving License, Passport, Voter ID, Govt issued i-card, Aadhar Card |
PAN card, Driving License, Passport, Voter ID, Govt issued i-card, Aadhar Card |
| Proof of Income |
Last 6 months salary slip, last 2 years Form 16, bank account statement of the last 6 months reflecting credited salary |
Bank account statement of the last 6 months and last 2 years ITR |
| Proof of Address |
Driving License, Election ID card, Passport, Telephone/bank statement Electricity/ Mobile bill (latest up to 3 months old) |
Utility bill/bank statement latest up to 3 months old, TAN allotment letter, lease or rent agreement, registry copy |
| Proof of Age |
Birth certificate, School/college leaving certificate, Passport, Driving License, PAN card, Voter id card, Employee ID card (only for PSU/ Government employees) |
Birth certificate, School/college leaving certificate, Passport, Driving License, PAN card, Voter id card, Employee ID card (only for PSU/ Government employees) |
| Certificate and Business Existence Proof |
|
Certificate of practice, PAN, VAT/ sales tax/ excise/service tax registration, Trade license, Copy of partnership deed, registration certificate issued by RBI, SEBI |
Personal Loan Interest Rates
One of the important things to do before applying for personal loans is checking the interest rates offered by banks and NBFCs. The Personal Loan Interest Rates will differ from a financial institution to another on grounds of your individual profile, repayment capacity, income, required loan amount, loan tenure, credit score, and other factors.
| Interest Rate |
Starting at 10.50% onwards |
| Processing Fees |
1% to 3% of the borrowed principal amount |
| Loan Tenure |
1 Year to 5 Years |
| Pre-closure Charges |
May vary from one lender/Bank/NFBC to other |
Personal Loans Interest Rates by Top Banks and NBFCs - June 2020
| Bank |
Loan Amount |
Personal Loan Interest Rates |
Lowest EMI per lakh for 60 Months Tenure |
| SBI Personal Loans |
Rs. 20 lakhs Max |
10.50% - 11.20% onward |
Rs. 2,149 |
| HDFC Bank Personal Loans |
Rs. 40 Lakhs Max |
10.75% onward |
Rs. 2,162 |
| Muthoot Finance Personal Loan |
Rs. 10 Lakhs Max |
14% onward |
Rs. 2,327 |
| Small Business FinCredit (SBFC) Personal Loan |
Rs. 10 Lakhs Max |
13.75% onward |
Rs. 2,314 |
| ICICI Bank Personal Loans |
Rs. 20 Lakhs Max |
11.25% onward |
Rs. 2,187 |
| Axis Bank Personal Loans |
Rs. 15 Lakhs Max |
12% onward |
Rs. 2,224 |
| RBL Bank Personal Loans |
Rs. 20 Lakhs Max |
14% onward |
Rs. 2,327 |
| Kotak Bank Personal Loans |
Rs. 15 Lakhs Max |
10.99% onward |
Rs. 2,174 |
| Capital First Personal Loans |
Rs. 40 Lakhs Max |
10.75% |
Rs. 2,162 |
| Tata Capital Personal Loans |
Rs. 25 Lakhs Max |
10.99% onward |
Rs. 2,174 |
| Bajaj Finserv Personal Loans |
Rs. 25 Lakhs Max |
12.99% onward |
Rs. 2,275 |
| Fullerton India Personal Loans |
Rs. 20 Lakhs Max |
12.99% onward |
Rs. 2,275 |
Personal Loan EMI Calculation
The online personal loan EMI Calculator helps to calculate the monthly instalment amount that you have to pay towards repayment. On the calculator enter the desired loan amount, interest rate, and tenure.
- The EMI (equated monthly instalment) calculator displays a detailed repayment table. It shows a break-up of the Total Payment (Principal + Interest)
- It also shows the amortization schedule. This payment schedule shows the interest and principal amount that you have to pay separately over a selected tenure.
- You will get an exact idea of the opening balance, equated monthly instalment, break-up of interest and principal, and the outstanding loan amount.
Personal Loan Illustration
We have provided an example of the total cost of a personal loan:
- Principal Borrowed: Rs. 1 Lakh
- Tenure: 60 months
- Interest Rate: 11%
- Processing Fee: Rs. 2,000
- Loanbaba Service Fee: No fee
- EMI: Rs. 2,174 (as per 60 months tenure)
- Total Interest Payable: Rs.30,455 in 60 months
- Total of Payments: Rs. 1 Lakh Principal + Rs.30,455 Interest = Rs.130,455 + Rs. 2,000 Processing Fee = 132455
Pre Part-Payment and Foreclosure in Personal Loan
A personal loan comes with a fixed tenure. The tenure is the repayment period. You are expected to repay the debt via EMIs within this fixed tenure. But anytime if you want to repay the loan sooner than the end of repayment period, you can opt for: Part pre-payment or Foreclosure.
| Details |
Full Pre-payment/Foreclosure |
Part Pre-payment |
| What is? |
If you pay off the entire outstanding before the end of tenure, then it is known as full pre-payment or foreclosure. |
If you pay a part of the outstanding amount before the tenure’s end, then it is known as part pre-payment. |
| Benefits |
One of the benefits of foreclosure is that you save on the interest payout.
You can also save on the prepayment interest if the lender does not charge an interest on foreclosure of the loan. |
One of the benefits of part pre-payment is that you can use excess funds in hand to pay a portion of the outstanding amount.
Thus, any interest thereby charged would be on the reduced outstanding principal amount.
So, you can expect the EMI amount to also reduce. Also, the total interest payout will also decrease. |
| Precautions |
However, if the lender charges a penalty on foreclosure, then you may have to pay a good amount of interest.
This is why before foreclosing a loan, check the factors related to it. Full pre-payment may not always be the right option. |
Several lenders charge a fee for part-payment. You need to check the charge for part-payment and analyze if it is the best to pay off a portion of the outstanding principal or not. |
Why Choose Loanbaba to Help You Find a Personal Loan?
We at Loanbaba offer you personal loan offers from top banks and NBFCs in India. Being one of the leading FinTech firms, and an online platform that helps one access secured and unsecured loans, we ease your borrowing decision. Some of the features you can use for free on our website are as follows.
- Guaranteed Privacy and Transparency: We send your personal loan application to the bank/NBFC electronically. There is no risk to your privacy. Information you share with us is never shared with any unconcerned party.
- Grab Instant Quotes from Top Lenders: You will get instant quotes, interest rates, and offers from popular banks and NBFCs on our website.
- E-approval Within No Time: You may login to your account on Loanbaba to track your loan application. Most of the banks/NBFCs provide a lending decision in a matter of only 48 hours.
- Free-of-cost Financial Tools: You can check your loan amount eligibility with the help of an Eligibility Calculator. Also, you can calculate the EMI for the month with the EMI calculator. Both these financial calculators are available on our website, free of any charge.
- Top Notch Customer Service: You can get in touch with us on our toll-free number or email id for queries related to personal loans or any other financial product we offer. Our customer care team is quick to respond and offer you the best solution.
How to Apply for a Personal Loan on Loanbaba?
To apply for personal loan at Loanbaba:
- Scroll to the top of the page and drop your loan application online.
- Fill the details asked such as your name, loan amount required, employment status etc.
- You can check the top banks and NBFCs for personal loans in India and apply for paperless loans today to get immediate quotes.
- For any help, get touch with us at +91 7875380889/7057280385 or email on customersupport@loanbaba.com.