Personal Loan Providers

Personal Loan Starts @ 10.49% Per Annum

Minimum Salary Requirement Rs. 50,000

Contact Us: +91 9650757020

Apply For Personal Loan

Personal Loan Providers

Personal Loan Starts @ 10.49% Per Annum

Minimum Salary Requirement
Rs. 50,000

Contact Us: +91 9650757020

Apply For Personal Loan

Immediate Inquiry
| | | | | | | |

Refer Someone For Loan & Get Rs. 5000 Now

One Loan For Your Different Needs

One Loan For Your Different Needs

INDIA'S FIRST LOAN DISTRIBUTION COMPANY

4 Million +

Happy Customers

2500+

Managers

45,000 Cr+

Business Done

With 100+

Banks & NBFCs

why us

Superfast Processing

with 72 hours

No Collateral Required

No risk of any asset loss

Fair Interest Rates

from 10.49% per year

Flexible Repayments

We care for your convenience

Testimonials

Documents Required

Application Form

Passport-size Photograph

Identity (ID) Proof

Adress Proof

Income Proof

Basic Eligibilty Criteria

Must Have Good
Credit Score

Must Have Resident
of India

Above 21 years
of Age

Must Have
Salaried Professional

Must Have
Valid Bank Account

Salary Slip For
Last Three Months

Pan Card, Voter ID Card and Driving License

Bank Statements for the last three months

FAQ

What is a Personal Loan?

A Personal Loan is an unsecured loan provided by banks and financial institutions to meet personal exigencies.

When Should I Consider Taking a Personal Loan?

Financial woe scan arise at any time. You may need funds to pay for educational expenses for your children or a wedding in the house. There could also be unexpected medical bills to deal with.

Availing a Personal Loan as an additional back-up is something you could consider if you find yourself in a tough spot. Some people take Personal Loans to consolidate their credit card debt. You too can do this and pay off your existing credit card outstanding amount. Monry Solution has products which offer Personal Loans for home renovation as well as consumer durables like a television or a refrigerator - the possibilities are endless.

A decade or so ago, taking a Personal Loans was not common. Now, with rising incomes and increased competition among banks to improve their credit portfolios, Personal Loans have become more accessible to get. There are various advantages of taking Personal Loans. Banks these days offer attractive interest rates as well as the flexibility of repayment.

Monry Solution can help you decide on a Personal Loan with options from over 70+ banks and NBFCs (Non-Banking Financial Companies).

Advantages of a Personal Loan

No Collateral - This is the most significant advantage of taking a Personal Loan. It is the most convenient option from the customer's point of view. You do not need to mortgage an asset for taking a Personal Loan.

No end use requirement -You can avail a Personal Loan for any purpose. There is no compulsion on borrower's part to disclose the use of funds. However, banks do take a declaration that you will not use the loan for speculative purposes.

Quick processing - These loans are available with out any security. If you satisfy the eligibility criteria, you get a Personal Loan approval in a short period. Certain banks give online approvals too.

Fixed Rate of Interest - Banks decide the rate of interest on personal financing at the time of processing the loan application. It remains fixed throughout its tenure. Hence, you need not worry about variable EMIs (Equated Monthly Instalments) or interest rate fluctuations.

Repayment flexibility -The average repayment period of a Personal Loan ranges from 36 months to 84 months. The more extended the loan repayment period, the lower the EMI. Individual financial institutions allow you to repay the interest amount alone every month with the arrangement of paying a pre-determined amount towards the principal repayment at the end of the year.

Tax benefits - If you avail a Personal Loan for renovating your home, you are eligible for Income Tax deductions up to 2 Lakhs under Section 24B of the Income Tax Act, 1961. However, you will have to prove that you used the loan for home renovation only.

Why Apply for a Personal Loan with Monry Solution?

Each bank has its individual Personal Loan scheme with varying rates of interest and repayment periods. They also have different methods of reviewing loan eligibility. It can all be very confusing, and Monry Solution can help you through the entire process. Applying for a Personal Loan with Monry Solution is an advantage because we do the hard work for you. We will collate the information on a single screen where you can compare the different products.

We provide the requisite information and guidance in the following manner.

Help you in determining eligibility depending on your income and repayment capacity
Compare different products on offer and help choose the most appropriate product for you
Highlight the processing fee of different banks thereby helping you to select the Personal Loan that offers the most significant benefit
Ease of documentation witha quick turnaround time
Since we host several products from various Banks and NBFCs, you are not restricted and have several options.

Monry Solution has Experts who can:

Assess your profile and determine your eligibility
Analyse your repayment history and advise you accordingly
Decipher the fine print, especially in the case of seemingly attractive offers

Features of a Personal Loan:

The rate of Interest - The rate of interest on Personal Loans is between 11-14% depending on your credit score, income and so forth.

Loan amount - You can get a Personal Loan for as low as 50,000 and as high as 50 Lakhs depending on your requirement and eligibility.

Loan Tenure - Festival loans are available for periods as short as 12 months. The average tenure for a Personal Loan is between 12 and 60 months,depending on the loan amount.

Security - Due to its unsecured nature, collateral is not required

Loan Turnaround Times - A Personal Loan typically has the fastest turnaround time in the industry. Many banks approve Personal Loans with in 48 hours after submission of the online application.

Processing Fees - It depends on the individual bank. Itusually ranges between 1- 2% of the loan amount.

Pre-payment Penalty - Banks charge pre-payment penalty if you repay your Personal Loan before the determined period. The charges range between 1-2% of the outstanding amount on the date of closure.

Factors Affecting the Eligibility of a Personal Loan:

Credit Score - This is the most crucial eligibility factor. A credit score of 650 or above is typically considered good score. The better your credit score, the higher are your chances of getting a Personal Loan.

Employment - Employees of listed companies, Central and State Governments, and public sector undertakings are eligible for a higher amount.

Work Continuity - You should be a long-term employee of your current organisation. In case you are self-employed, the continuity of business and income is the most critical

Age of the borrower - The minimum age requirement is 21 years. Banks have their criteria for deciding the maximum age limit. In most cases, your age at the end of the repayment period should not exceed 70 years.

Who is eligible to apply - Salaried persons, self-employed professionals, and self-employed persons are eligible to apply for a Personal Loan.

Eligibility amount - It depends on the bank sanctioning the Personal Loan. Various factors like gross income, take-home pay, other loan instalments, and Credit Card liabilities determine your eligibility. You can use Monry Solution's easy Personal Loan EMI Calculator and determine eligibility.

Documents Required for Availing a Personal Loan:

1. KYC - Documents for determining identity, age, and residence proof are needed when applying for a Personal Loan. These documents are:

PAN Card
Aadhar Card
Driving Licence
Voter ID
Passport

Registered Rent Agreement

2. Income Documents - In case you are a salaried employee, you need to furnish the following documents:

Salary slips for the last 6 months
IT Return along with Form 16 for the past two years
Bank Account Statement of previous 3 months that reflects your salary credits and other income
Employment certificate from current employer

In case you are self-employed (professional or business owner), the following documents will suffice:

Financial statements that include Balance Sheet and Profit and Loss Statement
IT Returns for the last 2 years
Proof of continuity of business income such as Bank Account Statement
Evidence of doing business like GST Registration

3. Other Documents- This includes your loan application form.

Personal Loan Eligibility Tips:

It is likely that you receive hundreds of calls, texts and e-mails regarding Personal Loans.

Monry Solution can help choose the best loan offer for you as we have a structured process that will guide you through every step.

Monry Solution can help you avoid common mistakes when applying for a Personal Loan:

Interest Rates - People look at the rate of interest offered by lending banks and tend to ignore other charges like processing fees, pre-payment clauses, and late payment fees. Monry Solution guides you through each aspect while helping you choose the most appropriate Personal Loan Offer.

Applying for a higher amount than necessary- Some people tend to apply for higher amounts than they require as the eligibility criteria are quite generous. Monry Solution helps you arrive at the optimum figure. We account for the current as well as contingent liabilities while helping you decide on the loan amount.

How do they calculate the eligibility of the Personal Loan?

Every bank has its eligibility criteria. The loan eligibility depends on various factors

The nature of your employment plays an essential role in your eligibility. Central and State Government employees do not have any problems in getting Personal Loans. At the same time, an employee of a small company can face some issues. Banks categorise employers into different categories such as A, B, C, and so on. The higher the grade, the higher is the loan eligibility.

The take-home pay is a crucial feature of your Personal Banks prescribe a minimum of 50% of take-home pay after considering the prospective Personal Loan EMI.

Your credit score is the clinching factor. Any rating over 750 is an excellent one. Banks usually do not approve Personal Loans for people with credit scores below 650.

I have a decent salary package. However, the bank rejected my Personal Loan application. What can I do now?

Approving any loan is the prerogative of the bank. There are various reasons for rejection of the Personal Loans.

You might be having many loans outstanding. The possible solution is to bring in a co-borrower. Your working spouse can join as a co-borrower. You can also try to reduce your existing liabilities by closing some of your loans.

You might have an adverse credit score. Check your credit report and go through it in detail. There can be errors in your report. Dispute them if necessary and take the steps needed to rectify your credit report. Remember, you need a minimum credit score of 650 to 700 to be eligible for a Personal Loan.

What are the minimum and maximum loan amounts offered by banks?

Generally, the minimum loan amount is around 50,000,and the maximum amount can go up to 50 Lakhs depending on your eligibility.

The banks like to have a personal discussion with borrowers before approving higher Personal Loan limits.

How does the credit score affect the Personal Loan approvals?

Banks stipulate a minimum credit score for processing a Personal Loan application.

They do not have any hesitation in approving Personal Loans to borrowers having a credit score more than 650.

It is better to order your credit report from the credit bureaus and know your score. It can save you the trouble of having to deal with a loan rejection.

Banks make inquiries with the credit bureaus before sanctioning the Personal Loans. Every query affects your credit score.

Points to Ponder Before Taking a Personal Loan

Personal Loans are easy to get. They are the best options to fight off financial crunches. You need not provide any collateral or guarantee. A decent disposable income and a good credit record are enough for banks to approve your Personal Loans. However, you should consider these essential points before deciding to avail a Personal Loan.

Shop around for the best offer - A Personal Loan is one of the most conventional loan products available. However, the interest rate and other charges vary a lot from one bank to another. It is advisable to shop around and check out the offers before applying for a personal loan. Monry Solution is one place where you can get access to a variety of personal loan products from different banks. You can compare these products on a single screen and decide on the best option.

Check out the EMIs - Personal Loans have bigger EMIs than other loans because of their short tenure and comparatively higher rates of interest. Therefore, it is better to use our EMI calculator and check out your EMI. Usually, banks insist on take-home pay of around 50% after catering to all your liabilities including the EMI of the proposed Personal Loan. The thumb rule is that your EMI should not exceed 10% of your income. It will keep your EMI affordable and allow you to repay your loans quickly, thus improving your credit score.

A shorter tenure is preferable - Personal Loans are available for tenures lasting up to 60 months. It is better if you keep your tenure shorter than that. The ideal tenure is 36 months. Nevertheless, you should also check out the EMI affordability. You should be able to afford the EMI. Maintain the right balance between the loan amount, your EMI, and the tenure of your Personal

Read the fine print carefully - Make it a point to read your loan document carefully. There are many hidden charges such as late fee penalty, cheque bounce charges, pre-payment penalties, lock-in period, and so on. Consult your financial advisor before you sign on the dotted line. Some banks charge interest on reducing balance method whereas some banks follow the straight-line Understand the difference between the two. Use our EMI calculator to estimate the total outflow.

Opt for Loan Insurance - Loan insurance has become a favourite product today. It will be the biggest favour you do to your legal heirs. You do not leave behind any loan liability in case of any untoward incidents. Many banks include the loan insurance premium in the loan amount. As you repay the loan in instalments, you do not feel the pinch.

Consider these points before you apply for your Personal Loan. Remember, there are hundreds of options open to you, but not all of them are beneficial.

Avail the guidance of the experts at Monry Solution to help you make a decision.

To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.Monry Solution.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.

Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.

FAQ

What is a Personal Loan?

A Personal Loan is an unsecured loan provided by banks and financial institutions to meet personal exigencies.

When Should I Consider Taking a Personal Loan?

Financial woe scan arise at any time. You may need funds to pay for educational expenses for your children or a wedding in the house. There could also be unexpected medical bills to deal with.

Availing a Personal Loan as an additional back-up is something you could consider if you find yourself in a tough spot. Some people take Personal Loans to consolidate their credit card debt. You too can do this and pay off your existing credit card outstanding amount. Monry Solution has products which offer Personal Loans for home renovation as well as consumer durables like a television or a refrigerator - the possibilities are endless.

A decade or so ago, taking a Personal Loans was not common. Now, with rising incomes and increased competition among banks to improve their credit portfolios, Personal Loans have become more accessible to get. There are various advantages of taking Personal Loans. Banks these days offer attractive interest rates as well as the flexibility of repayment.

Monry Solution can help you decide on a Personal Loan with options from over 70+ banks and NBFCs (Non-Banking Financial Companies).

Advantages of a Personal Loan

No Collateral - This is the most significant advantage of taking a Personal Loan. It is the most convenient option from the customer's point of view. You do not need to mortgage an asset for taking a Personal Loan.

No end use requirement -You can avail a Personal Loan for any purpose. There is no compulsion on borrower's part to disclose the use of funds. However, banks do take a declaration that you will not use the loan for speculative purposes.

Quick processing - These loans are available with out any security. If you satisfy the eligibility criteria, you get a Personal Loan approval in a short period. Certain banks give online approvals too.

Fixed Rate of Interest - Banks decide the rate of interest on personal financing at the time of processing the loan application. It remains fixed throughout its tenure. Hence, you need not worry about variable EMIs (Equated Monthly Instalments) or interest rate fluctuations.

Repayment flexibility -The average repayment period of a Personal Loan ranges from 36 months to 84 months. The more extended the loan repayment period, the lower the EMI. Individual financial institutions allow you to repay the interest amount alone every month with the arrangement of paying a pre-determined amount towards the principal repayment at the end of the year.

Tax benefits - If you avail a Personal Loan for renovating your home, you are eligible for Income Tax deductions up to 2 Lakhs under Section 24B of the Income Tax Act, 1961. However, you will have to prove that you used the loan for home renovation only.

Why Apply for a Personal Loan with Monry Solution?

Each bank has its individual Personal Loan scheme with varying rates of interest and repayment periods. They also have different methods of reviewing loan eligibility. It can all be very confusing, and Monry Solution can help you through the entire process. Applying for a Personal Loan with Monry Solution is an advantage because we do the hard work for you. We will collate the information on a single screen where you can compare the different products.

We provide the requisite information and guidance in the following manner.

Help you in determining eligibility depending on your income and repayment capacity
Compare different products on offer and help choose the most appropriate product for you
Highlight the processing fee of different banks thereby helping you to select the Personal Loan that offers the most significant benefit
Ease of documentation witha quick turnaround time
Since we host several products from various Banks and NBFCs, you are not restricted and have several options.

Monry Solution has Experts who can:

Assess your profile and determine your eligibility
Analyse your repayment history and advise you accordingly
Decipher the fine print, especially in the case of seemingly attractive offers

Features of a Personal Loan:

The rate of Interest - The rate of interest on Personal Loans is between 11-14% depending on your credit score, income and so forth.

Loan amount - You can get a Personal Loan for as low as 50,000 and as high as 50 Lakhs depending on your requirement and eligibility.

Loan Tenure - Festival loans are available for periods as short as 12 months. The average tenure for a Personal Loan is between 12 and 60 months,depending on the loan amount.

Security - Due to its unsecured nature, collateral is not required

Loan Turnaround Times - A Personal Loan typically has the fastest turnaround time in the industry. Many banks approve Personal Loans with in 48 hours after submission of the online application.

Processing Fees - It depends on the individual bank. Itusually ranges between 1- 2% of the loan amount.

Pre-payment Penalty - Banks charge pre-payment penalty if you repay your Personal Loan before the determined period. The charges range between 1-2% of the outstanding amount on the date of closure.

Factors Affecting the Eligibility of a Personal Loan:

Credit Score - This is the most crucial eligibility factor. A credit score of 650 or above is typically considered good score. The better your credit score, the higher are your chances of getting a Personal Loan.

Employment - Employees of listed companies, Central and State Governments, and public sector undertakings are eligible for a higher amount.

Work Continuity - You should be a long-term employee of your current organisation. In case you are self-employed, the continuity of business and income is the most critical

Age of the borrower - The minimum age requirement is 21 years. Banks have their criteria for deciding the maximum age limit. In most cases, your age at the end of the repayment period should not exceed 70 years.

Who is eligible to apply - Salaried persons, self-employed professionals, and self-employed persons are eligible to apply for a Personal Loan.

Eligibility amount - It depends on the bank sanctioning the Personal Loan. Various factors like gross income, take-home pay, other loan instalments, and Credit Card liabilities determine your eligibility. You can use Monry Solution's easy Personal Loan EMI Calculator and determine eligibility.

Documents Required for Availing a Personal Loan:

1. KYC - Documents for determining identity, age, and residence proof are needed when applying for a Personal Loan. These documents are:

PAN Card
Aadhar Card
Driving Licence
Voter ID
Passport

Registered Rent Agreement

2. Income Documents - In case you are a salaried employee, you need to furnish the following documents:

Salary slips for the last 6 months
IT Return along with Form 16 for the past two years
Bank Account Statement of previous 3 months that reflects your salary credits and other income
Employment certificate from current employer

In case you are self-employed (professional or business owner), the following documents will suffice:

Financial statements that include Balance Sheet and Profit and Loss Statement
IT Returns for the last 2 years
Proof of continuity of business income such as Bank Account Statement
Evidence of doing business like GST Registration

3. Other Documents- This includes your loan application form.

Personal Loan Eligibility Tips:

It is likely that you receive hundreds of calls, texts and e-mails regarding Personal Loans.

Monry Solution can help choose the best loan offer for you as we have a structured process that will guide you through every step.

Monry Solution can help you avoid common mistakes when applying for a Personal Loan:

Interest Rates - People look at the rate of interest offered by lending banks and tend to ignore other charges like processing fees, pre-payment clauses, and late payment fees. Monry Solution guides you through each aspect while helping you choose the most appropriate Personal Loan Offer.

Applying for a higher amount than necessary- Some people tend to apply for higher amounts than they require as the eligibility criteria are quite generous. Monry Solution helps you arrive at the optimum figure. We account for the current as well as contingent liabilities while helping you decide on the loan amount.

How do they calculate the eligibility of the Personal Loan?

Every bank has its eligibility criteria. The loan eligibility depends on various factors

The nature of your employment plays an essential role in your eligibility. Central and State Government employees do not have any problems in getting Personal Loans. At the same time, an employee of a small company can face some issues. Banks categorise employers into different categories such as A, B, C, and so on. The higher the grade, the higher is the loan eligibility.

The take-home pay is a crucial feature of your Personal Banks prescribe a minimum of 50% of take-home pay after considering the prospective Personal Loan EMI.

Your credit score is the clinching factor. Any rating over 750 is an excellent one. Banks usually do not approve Personal Loans for people with credit scores below 650.

I have a decent salary package. However, the bank rejected my Personal Loan application. What can I do now?

Approving any loan is the prerogative of the bank. There are various reasons for rejection of the Personal Loans.

You might be having many loans outstanding. The possible solution is to bring in a co-borrower. Your working spouse can join as a co-borrower. You can also try to reduce your existing liabilities by closing some of your loans.

You might have an adverse credit score. Check your credit report and go through it in detail. There can be errors in your report. Dispute them if necessary and take the steps needed to rectify your credit report. Remember, you need a minimum credit score of 650 to 700 to be eligible for a Personal Loan.

What are the minimum and maximum loan amounts offered by banks?

Generally, the minimum loan amount is around 50,000,and the maximum amount can go up to 50 Lakhs depending on your eligibility.

The banks like to have a personal discussion with borrowers before approving higher Personal Loan limits.

How does the credit score affect the Personal Loan approvals?

Banks stipulate a minimum credit score for processing a Personal Loan application.

They do not have any hesitation in approving Personal Loans to borrowers having a credit score more than 650.

It is better to order your credit report from the credit bureaus and know your score. It can save you the trouble of having to deal with a loan rejection.

Banks make inquiries with the credit bureaus before sanctioning the Personal Loans. Every query affects your credit score.

Points to Ponder Before Taking a Personal Loan

Personal Loans are easy to get. They are the best options to fight off financial crunches. You need not provide any collateral or guarantee. A decent disposable income and a good credit record are enough for banks to approve your Personal Loans. However, you should consider these essential points before deciding to avail a Personal Loan.

Shop around for the best offer - A Personal Loan is one of the most conventional loan products available. However, the interest rate and other charges vary a lot from one bank to another. It is advisable to shop around and check out the offers before applying for a personal loan. Monry Solution is one place where you can get access to a variety of personal loan products from different banks. You can compare these products on a single screen and decide on the best option.

Check out the EMIs - Personal Loans have bigger EMIs than other loans because of their short tenure and comparatively higher rates of interest. Therefore, it is better to use our EMI calculator and check out your EMI. Usually, banks insist on take-home pay of around 50% after catering to all your liabilities including the EMI of the proposed Personal Loan. The thumb rule is that your EMI should not exceed 10% of your income. It will keep your EMI affordable and allow you to repay your loans quickly, thus improving your credit score.

A shorter tenure is preferable - Personal Loans are available for tenures lasting up to 60 months. It is better if you keep your tenure shorter than that. The ideal tenure is 36 months. Nevertheless, you should also check out the EMI affordability. You should be able to afford the EMI. Maintain the right balance between the loan amount, your EMI, and the tenure of your Personal

Read the fine print carefully - Make it a point to read your loan document carefully. There are many hidden charges such as late fee penalty, cheque bounce charges, pre-payment penalties, lock-in period, and so on. Consult your financial advisor before you sign on the dotted line. Some banks charge interest on reducing balance method whereas some banks follow the straight-line Understand the difference between the two. Use our EMI calculator to estimate the total outflow.

Opt for Loan Insurance - Loan insurance has become a favourite product today. It will be the biggest favour you do to your legal heirs. You do not leave behind any loan liability in case of any untoward incidents. Many banks include the loan insurance premium in the loan amount. As you repay the loan in instalments, you do not feel the pinch.

Consider these points before you apply for your Personal Loan. Remember, there are hundreds of options open to you, but not all of them are beneficial.

Avail the guidance of the experts at Monry Solution to help you make a decision.

To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.Monry Solution.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.

Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.

PERSONAL LOAN PROVIDERS




PERSONAL LOAN PROVIDERS


How it Works

Apply Online

Low Paper Work

High Approval

Bank Transfer

Other Services

Personal Loan

There are basically two types of Interest rates applicable on a personal loan, these are:

  • Fixed Rate of Interest
  • Floating Rate of Interest

a) Fixed Rate of Interest: In this case, the rate of interest remains constant throughout the loan tenure. Consequently, monthly EMI amount also remain fixed throughout the loan repayment period. This may help you plan your monthly expenditure in the long term.

...

b) Floating Rate of Interest: It depends on either the internal benchmark set by the lender or as current market conditions. As a result, floating interest rate is liable to change periodically which leads to increase/decrease in loan tenure or monthly EMI payouts depending on whether the rate moves upwards or downwards.

Interest Calculation Methods

Personal loan interest can be calculated in the following two ways:

  • a) Flat Rate
  • b) Reducing Balance method

a) Flat Rate Method of Interest Calculation: In this method, interest is calculated on the total loan amount initially borrowed over the entire tenure of the loan.

b) Reducing Balance Method of Interest Calculation: As you pay off your monthly EMIs, parts of the loan amount and the interest component are paid off. Thus, the principal loan amount keeps on decreasing with time. In this method, interest is calculated on this decreasing loan amount and not the total amount initially borrowed.

Interest Rates for Different Applicant Types

Most lenders consider a number of factors when deciding the interest rate applicable to personal loan applicants. One of these is the applicant type. The following are some insights regarding how personal loan interest rates tend to vary depending upon the type of applicant:

Salaried and self-employed: Whether the applicant is salaried or self-employed can significantly impact the interest rate applicable to a personal loan. Generally, salaried employees with a stable employment record working with reputed organizations tend to get a personal loan at a lower rate of interest than self-employed. This is because salaried employees working with a reputed company have greater job security, and in most cases better ability to repay their loan. However, self-employed applicants with a stable source of income can also avail personal loans from banks and NBFCs at competitive interest rates.

Women: Certain banks and NBFCs, such as Bajaj Finserv and Fullerton India offer preferential rate of interest to women. This is in an attempt to promote salaried women, entrepreneurs and professionals to fulfill their dreams and be financially stable.

Pensioners: Pensioners can avail special personal loan specifically meant for them at a relatively lower rate of interest from banks like State Bank of India (SBI) and Punjab National Bank (PNB). In most cases, preferential (lower) interest rate on pension loans is available in case, the pension account is held with the chosen lender.

Please note that beyond the applicant type, interest rate depends on the individual applicant profile. People with a stable source of income, good credit history and high credit score tend to receive a loan at a lower rate, irrespective of their category.

Personal Loan Balance Transfer Rates

Personal Loan balance transfer refers to the process, wherein you transfer your existing personal loan account with an existing lender to a new lender for better repayment terms such as a lower interest rate. This option generally allows you to save on the interest payable on your personal loan. For example: if you transfer your existing personal loan of Rs. 10 lakh@16% for 48 months after 12 months to another bank offering a lower rate of interest @14% p.a. for the remaining tenure of 36 months, then you will save Rs. 28,421*. Please note that in this example, as illustrated below, both the banks follow reducing balance method of interest calculation.

The personal loan balance transfer rates depend on both the bank’s internal criteria as well as the individual applicant’s profile. For example, the personal loan balance transfer interest rates for HDFC bank, ICICI Bank and Axis bank start at 11.39%, 11.29% and 12% respectively. Do keep in mind that personal loan balance transfer offers typically have some additional fees/charges associated with them such as processing fees, prepayment charges applicable to the original loan, etc.

Interest Formula and Calculation

Following are the formulae for interest calculation using flat rate method and reducing balance method:

Flat Rate Method: Interest is charged on the total loan amount initially borrowed. The formula to calculate EMI on the basis of this method is as follows: EMI by Flat Rate Method = (Principal + Total Interest Payable) / Loan Tenure in Months

Where, Total Interest Payable = Principal x Interest Rate x Loan Tenure/100

Reducing Balance Method: In this case interest for subsequent months is charged on the outstanding loan amount. The formula to calculate EMI on the basis of this method is as follows:

EMI by Reducing Balance Method = [P x R x (1+R)^N]/[(1+R)^ (N-1)]

Where,

P = Principal loan amount

R = Rate of interest on a monthly basis

N = Loan repayment tenure in months

How to Get Low Interest Rate on Personal Loan?

Follow the below-mentioned tips to get low interest rate on your personal loan:

  • Maintain a high credit score.
  • Keep a low credit utilization ratio.
  • Maintain a low FOIR (fixed obligation to income ratio).
  • Do not apply for a personal loan with multiple lenders at the same time.
  • Opt for your personal loan from a bank/NBFC with which you already have a relationship, such as a savings account or a fixed deposit.

Factors Affecting Personal Loan Interest Rates

Credit History and Credit Score: Your credit history and credit score are reflective of your creditworthiness. The higher your credit score, greater are your chances of getting approved for a personal loan at a low rate of interest.

Income: Higher income typically indicates at a higher repayment capacity which often translates into a preferentially lower rate of interest for your personal loan.

Credit Utilization Ratio: This refers to the ratio of credit used to the total credit available to you. Ideally, this should not exceed 30%. A lower credit utilization ratio typically indicates higher repayment capability.

Fixed Obligation to Income Ratio (FOIR): This refers to the ratio of pre-exisiting loan EMIs and credit card dues to your income. A large amount of pre-exisiting obligations leaves only a small amount of your income. Thus, you should maintain a low FOIR, preferably lower than 50% to get low personal loan interest rate.

Multiple Loan Applications: You should never apply for a personal loan with multiple lenders at the same time, as this portrays you as credit hungry. If multiple enquiries of your credit report are conducted within a short time, it negatively affects your credit score and lowers the chances of getting approved for a personal loan at a low interest rate.

Pre-exisiting Relationship with the Lender: Having a previous relationship with a lender also impacts the personal loan interest rate. For example, if you already have a savings account or a fixed deposit with the bank, chances of getting a lower rate of interest on your loan increases.

As mentioned above, a personal loan interest rate differs across different lenders. However, the personal loan rate may also differ across the different types of borrowers such as salaried employees, self-employed, pensioners and women borrowers. Detailed information about the varying personal loan rates against these categories is listed as follows:

Current Personal Loan Rates for Salaried Employees

The occupation of an individual plays a major role in getting an affordable interest rate. While both salaried and self-employed professionals can apply for a personal loan, in general, salaried employees can avail the loan at a comparatively lower interest rate. This is because salaried employees have stability in their jobs with a fixed source of income.

Factors Affecting Personal Loan Rates

There are a number of factors that affect personal loan interest rates. These are listed as follows:

Credit score : Personal loans are unsecured loans that are offered only on the basis of a person's repayment ability. This, however, is ensured with the help of credit score. All personal loan lenders ensure lending loans to an individual with a good credit score of 700 and above. In case of relatively low credit score, you may either get a personal loan at a high rate of interest or may not get it all.

Income : Income is another factor that ensures the lender of the loan repayment ability of the borrower. Thus, the higher the income, the lower would be the personal interest rate. Many lenders have fixed income criteria for lending personal loans, failing to which you may not be considered an eligible personal loan borrower.

Repayment history : A good repayment history depicts the financial discipline related to payments and repayment of loans and credit card bills. In case of any defaults in the repayment schedule, the lender may be suspicious of your abilities and may charge a higher interest rate. Thus, the credibility of your repayment history may help you grab a lower interest rate.

Existing relationship with the bank : In case you are an old customer of the lender via a savings or investment account, then it is likely that you will be offered a lower interest rate from that bank. This is because banks often offer pre-approved personal loans at concessional rates to their existing customers, in order to maintain their relationship with the existing customers.

Your organization’s reputation : The reputation of the organization you are currently working for plays an important role in helping you grab a decent personal loan interest rate. This is because a renowned and stable organisation will ensure the lender of your jobs security.

How to get the lowest personal loan rates?

As personal loans are unsecured loans, banks consider several factors before deciding to sanction the loan and offer low interest rates. Factors that have to be kept in mind when you apply for a personal loan are as follows:

Check special offers for your company – Always check current offers and interest rates offered for the company you are working for, as banks run special schemes for employees of top corporate.

Compare bank offers for varios loan amount – Some banks offer low interest rate at higher loan amount.

Check for rates at various loan tenure – Banks may offer lower rates on personal loan for certain tenure and, if possible, opt for tenures with lower interest rates. Apply for loan amount within the limit you are eligible for – Applying for an amount higher than your eligibility may lead to rejection of your loan application. Always check eligibility for a particular amount of loan before applying.

Avoid multiple bank application - Simultaneous loan applications get recorded in your CIBIL report and can hurt your chances of getting a loan as well as your credit score

Look beyond the offer from your salary bank – It is not e Various banks keep offering attractive schemes to acquire premium customers. Hence, the offer from your salary bank may not be the best option.

How are Personal Loan Interest Rates determined?

You should do a detailed comparison of personal loan interest rates and charges of all banks before chosing the best bank for personal loan.

Special offers for salaried employees and salaried account customers: Banks launch attractive schemes with low interest rates on a regular basis, especially for individuals working with large reputed companies. Rate of interest varies based on the categorisation of your company in the internal categories of banks which can vary from bank to bank. Hence, always check for offers from multiple banks to get the cheapest personal loan rates.

Processing fees – Most banks charge a processing fees of ₹ 999 to upto 2% of loan amount, whichever is higher. Since these loans are short tenure loans, higher processing fees can result in significantly high cost on loans. Hence, it is important to compare the All Inclusive Rates (AIRs) or the effective rate on personal finance loans to compare and select the right offer.

Insurance premium - Since these are unsecured loans, banks request the borrower to take an insurance policy when availing a loan. However, the premium varies from bank to bank depending upon the risk coverage under various policies. So, check the loan sanction letter carefully to know the coverage and premium.

Personal loan prepayment and foreclosure Banks typically levy prepayment or foreclosure charges on personal loans that can range from from nil to up to 5%. So, be careful to be mindful of choosing a loan with low prepayment charges as you consider low rate personal loan offers.

Types of Personal Loan Interest Rates

Personal loan interest rates varies across lender to lender. However, the calculation of personal loan is based on two rate types in general, as listed follows:

Fixed-rate of interests: The rate of interest charged on the loan amount remains constant throughout the loan tenure. Thus, the personal loan EMI also remains the same throughout the repayment schedule.

Floating rate of interest: Personal loan rate is not fixed and remains variable. The interest rate, in this case, is linked to the external benchmarks perceived by the lender such as RBI repo rate. Hence interest rates keep changing with market conditions. Also, since the rate is not fixed, the EMI on personal loan may increase or decrease abruptly.

Personal loan interest calculation can be done differently using the below-mentioned types of personal loans interest rate calculation. These are listed as follows:

Flat Rate Method : According to the flat rate method calculator of personal loan interest rate, the personal loan rate is calculated on the original loan amount throughout the loan tenure. Thus the principal amount remains the same. For instance, even when you borrow a personal loan for five years of Rs 10 lakhs, you will continue paying the interest on the whole of Rs 10 lakhs amount throughout the five years. This method is also called the fixed method of personal loan interest calculation.

Reducing rate method : The reducing balance method, as the name suggests calculates the interest rate on the outstanding loan amount. As per this method of interest calculation, the principal component that is paid during the monthly EMI is not chargeable for interest calculation;thus the outstanding balance reduces with time, and the interest is charged only on the remaining principal amount. As per this method, the interest amount reduces with time.