Canara Bank Personal Loan Interest Rates

Canara Bank Personal Loan Interest Rates

Canara Bank Personal Loan Interest Rate starts at 13%. The lowest EMI for Rs. 1 lakh is Rs. 2,683 for 48 months tenure. You can take the loan if you are a salaried or self-employed professional. You can borrow between Rs. 1 lakh and Rs. 3 lakhs. The tenure is 12 months to 48 months. You need to have a good credit score and meet eligibility criteria set by the bank to get approval for the loan. Some of the charges apart from the rate of interest are processing fees, preclosure charges, and part prepayment charges.

In this post we will discuss about interest rate Canara Bank personal loan features, other charges, factors that influence rate of interest, total cost of the loan, interest calculation, EMI calculation, and frequently asked questions.

Features of Canara Bank Personal Loan Interest Rate

Here are some of the features:

• The bank offers discounted schemes to borrowers working for government departments, banks, and reputed companies.
• It gives a personal loan to fulfil all types of requirements such as home renovation, medical emergency, education of children, travel, debt consolidation, big-ticket purchase, etc.
• The interest rate on the loan is up to 14%
• You can even opt for a top-up loan over the existing loan. The interest rate for the same starts at 13%.
• The processing fee is up to 0.50% of the loan amount along with taxes.
• You can choose to preclose or partly pay the outstanding due at no extra cost. Both options are open after payment of the first EMI.

Canara Bank Personal Loan Charges

Apart from the rate of interest, you need to understand about the other applicable charges that account for the total loan cost. Here are some of the charges applicable on the loan:

• Processing Fee: The bank charges a fee for all the efforts it takes to process the loan. Thus, the fee is non-refundable even if you cancel the loan. This fee is either subtracted from the disbursal amount or added to the first EMI. The maximum processing fee by Canara Bank is 0.50% of the principal borrowed amount along with the applicable tax.
• Foreclosure Charges: This is a charge that you need to pay to the bank for repaying the outstanding due entirely before the end of tenure. You can choose to preclose or foreclose the loan after payment of the first EMI. The bank does not apply any foreclosure charges in this case.
• Part Payment Charges: This is a charge that you pay on repaying a part of the outstanding due before end of tenure. You can choose to partially pay off the loan amount after the first EMI.
• Other Charges: Once the bank accepts your loan application, it will release a statement of charges which will include other charges as well as the interest rate. These charges could be mandatory ones or circumstantial such as that for EMI cheque bounce, loan cancellation, late payment, etc.

Factors That Influence Canara Bank Personal Loan Rate

The bank assesses your loan amount, financial liabilities, monthly income, employment details, and other factors to decide an interest rate. Here are few factors that impact the loan rate of interest:

• Loan Amount: The loan amount you can request for is between Rs. 1 lakh and Rs. 3 lakhs. The bank usually offers a lower rate of interest for a higher amount, and vice-versa.
• Salary: The bank will want to go through your monthly income and financial liabilities to understand your ability to afford EMIs. A higher salary bracket will convince the lender to provide a higher loan amount and lower rate.
• Loan Tenure: The shorter the tenure, lower will be the interest payout and vice-versa. But the bank may offer a lower rate of interest for longer tenure. The tenure is from 12 months to 48 months by Canara Bank.
• Repayment Capacity : The bank will check for your repayment capacity before approving the loan. It will verify your ability to pay the EMI. For this purpose, it will go through your CIBIL report and score, check your previous track record for repayments, and other information. If you have a great repayment capacity, it will offer a better interest rate.
• Employer Category : The bank may have an internal list of firms and organizations ranked from high to low based on its reputation, size, and relationship with the lending institution. So, if you work for a company with a higher rating in the list of the bank, then you may get lower rates and better offers.
• Relationship with the Bank : The financial institution may offer special rates and charges to loyal and existing account holders. If you have a good track record of payments with this bank in the past, then you may be offered a lower rate of interest.

Canara Bank Personal Loan Total Cost Illustration

Canara Bank Personal Loan Interest Calculation

Here is an illustration for interest amount calculation. The borrowing amount is Rs. 1 lakh and 13% is the rate. Now here is how the interest amount you have to bear for different tenures:

• From the example above, it is evident that EMI is lower for a loan on longer tenure, and vice-versa. The interest payout is lower for a shorter tenure, and vice-versa.
• For instance, for 48 months tenure against Rs. 1 lakh borrowed; the monthly instalment is Rs. 2,683. The interest outgo is Rs. 28,784.
• On the other hand, the monthly instalment is Rs. 4,754 for a borrowing of Rs. 1 lakh for 2 years. The interest outgo is Rs. 14, 096 in this case.
• Thus, choose tenure as wisely and as per your repayment ability.

Canara Bank Personal Loan EMI Calculation

EMI is equated monthly instalment. It is a fixed amount that is for repayment of the loan. You need to pay the EMI on a fixed date every month till end of the tenure. It consists of both principal and interest component. With payment of every monthly instalment, the proportion of principal amount increased and interest component keeps reducing. However, the EMI amount remains the same.

The monthly instalment for a loan depends on the loan amount, interest rate, tenure, employment details, and monthly salary apart from other factors. The lowest Canara Bank Personal Loan Interest Rate is 13%. So, for Rs. 1 lakh borrowing for 48 months, the lowest instalment amount for a month is Rs. 2,683.

At 13% rate and different loan amounts and tenures, here is an illustration of Canara Bank personal loan EMI:

• It is evident from the above example that EMI amount differs with varying loan amount and tenure even at the same interest rate.
• The EMI amount is lower on a loan of longer tenure and vice-versa.
• For instance, EMI is Rs. 16,847 for Rs. 10 lakhs loan on tenure 3 years. The EMI is Rs. 13,414 for the same loan amount for 4 years.

Frequently Asked Questions for Personal Loan Interest Rate Canara Bank

Here are the Canara Bank Personal Loan Interest Rate FAQs:

• 1. What is the interest rate range for the loan?
  The lowest and the highest interest rate for Canara Bank personal loan is 13% and 14%, respectively. The loan amount is between Rs. 1 lakh and Rs. 3 lakhs. The tenure is between 12 months and 48 months. The interest amount depends on tenure and loan amount. The lower the principal borrowed and shorter tenure, lower is the total interest payout, and vice-versa. So, you must choose the loan amount and tenure wisely to save the most on the total cost.
• 2. How much CIBIL score is required for a personal loan?

  Credit score or CIBIL score is indication of your repayment capacity. Your CIBIL report shows all the repayment history such as your loan EMIs (ongoing, past, default, etc), credit card bill payments, and more. The higher the CIBIL score and nearer to 900, better the chances of getting a loan approval, and vice-versa. The minimum CIBIL score to get Canara Bank personal loan and best rate of interest is 750+. The higher the credit score over 750+, greater are the chances of getting the bank loan.

• 3. What is the effect of processing fee on the loan cost?

  The processing fee applicable on personal loan by Canara Bank up to 0.50% of the loan amount. The fee is only counted on the principal borrowed and not the interest amount. You will also have to bear the additional taxes. Apart from other charges and interest rate, processing fee too is counted in the total cost of the loan. Lower the processing fee (considering other charges too), lower will be the cost of the loan, and vice-versa.

• 4. What is the lowest and highest EMI amount?

  Consider that you have taken a loan of Rs. 1 lakh for 48 months at 13%. In this case the EMI amount (lowest) will be 2,683. For Rs. 1 lakh for 48 months at 14%, the highest EMI amount will be Rs. 8,979. The EMI amount will differ based on the loan amount, rate of interest, and tenure. You must calculate the EMI amount. For this, consider the rate and loan amount with tenure so that you can decide on the most affordable loan option and offer.

• 5. How to get the best rate of interest for personal loan Canara Bank?

  To get the lowest personal loan interest rate, you must have a good credit score and repayment capacity. You must have good amount of disposable income every month so as to afford the EMIs regularly. You should have a stable job and monthly salary. Higher the salary, better the chances of getting a low rate of interest. You can even negotiate for the rate, tenure, loan amount, and offer if you have a high income.