Have you been planning to raise a personal loan lately? It is recommended to first compare the interest rates charged by different banks and non banking financial corporation (NBFC). Typically, personal loan interest rates are relatively higher because they are unsecured and banks, therefore, make up for the risk of loss of capital by charging a higher interest rate.
It is worth noting that interest rate is one of the key factors that determines the equated monthly instalment, or EMI, on personal loan. Higher the interest rate, bigger the EMI and lower the rate, smaller the EMI.
Notably, the other key factor that determines a personal loan EMI is the time duration of loan.
These are some of the interest rate charged by banks on personal loans:
SBI: The largest state lender charges a rate that varies between 12.60 per cent to 14.60 percent, and between 11.45 percent to 11.95 percent for those who hold a salary account in the SBI.
HDFC Bank: The largest private lender charges 10.85 percent to 24 percent on personal loans. The processing charges on loan are ₹6,500 plus GST on it.
ICICI Bank: This private lender charges anywhere between 10.85 and 16.25 percent per annum.
Federal Bank: This private lender charges anywhere between 11.49 to 14.49 percent on its personal loans.
Kotak Mahindra Bank: It charges an interest rate of 10.99 percent to 16.99 percent on personal loans.
Punjab National Bank (PNB): The personal loan interest rate ranges between 12.5 to 14.50 percent per annum.
Axis Bank: It charges anywhere between 10.49 to 22.50 percent per annum.
(Note: Taking a loan has some risks involved)
