A personal loan is an unsecured loan provided by a bank or other financial institution. Personal loan interest rates are among the highest, therefore, it’s best to borrow from a lender that offers lower rates and shorter terms. Do keep in mind that banks give lower interest rates to those borrowers with high credit scores.
Personal loan interest rates vary from bank to bank.
For instance, IDBI Bank personal loan interest rates start from 8.15% and go up to 14%; these come with a tenure of 12-60 months and for amount between Rs 25,000 and Rs 5 lakh. The State Bank of India’s (SBI) personal loans rates start from 9.6% and go up to 15.65%; these come with a tenure of 6-72 months and one can borrow between Rs 25,000 and Rs 20 lakh.
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What is the maximum and minimum limit on personal loan
The minimum and maximum amount that can be borrowed vary with each bank and institution. SBI, for example, states on its website that salaried individuals can get a maximum personal loan of Rs 20 lakh. Personal loans up to Rs 12 lakh are available from HDFC Bank, according to the bank’s website.
You can acquire a personal loan for as little as Rs 75,000 and as much as Rs 25 lakh, according to Tata Capital’s website, depending on your creditworthiness.
Does a personal loan help deal with a coronavirus-led financial crisis?
In response to the covid crisis, some lenders have increased credit score and income requirements, making it more difficult for borrowers to qualify for a loan or get a low rate. Is it a good idea to get a personal loan at such a time. Tune in to find out.
Who is eligible for a personal loan?
Personal loan eligibility requirements differ from one bank to another. According to SBI’s website, you must have a minimum monthly income of Rs 15,000 to be eligible for a personal loan, regardless of whether you have a salary account with the bank.
Your credit score will also play a factor in deciding your eligibility for a personal loan. Individuals should be between the age of 21 and 60 who have worked for at least 2 years, with at least 1 year with the current employer. Those with a monthly net income of at least Rs 25,000 can apply with HDFC Bank.
What is the tenure of personal loans?
Lending institutions such as banks often give personal loans for a maximum of five years. The tenure, however, can differ depending on the institutions.
Go contactless: Your checklist for an online personal loan application
Do you qualify for a personal loan online?
Anyone eligible to get a regular, offline personal loan is eligible to get the same online too. All salaried persons and professionals in a steady job can avail of an online personal loan.
Where can you get such a loan?
The loans are available from all leading banks, NBFCs and fintech platforms. Note that there is no compulsion for your or any customer to take the loan from the bank where you hold your salary or savings bank account. You are free to scout for digital personal loans from any lender of your choice and compare to arrive at the one offering you the best deal.
Interest rates on online personal loans
Online personal loans are not necessarily costlier or come with high rates of interest or processing fees. In fact, they may turn out cheaper than in-person, offline personal loans due to lower operating costs etc. which if offline, lenders may pass on to borrowers. Depending on a borrower’s income, the company he/she works for, the loan amount needed and his/her credit score, the rate of interest may start from as low as 10.25% per annum (on a reducing balance basis) and go up to as much as 36%. Compare the various offerings in the market to pick out what’s best for you and your pocket.
Updated digital KYC needed
The key to availing the loan at an attractive rate in a fast and convenient manner however lies in having a correct and updated digital KYC footprint.
5 points for a successful application
- Your mobile number must be updated in your Aadhaar and bank account.
- You must have an active net banking facility on your main savings bank account in which you receive your monthly salary gets credited and the mobile number updated with the bank must match the one you are applying for the loan with which is also the one associated with your Aadhaar.
- Your latest current address must be updated in your Aadhaar and savings bank account.
- You must be able to both receive and send emails from your official email address, in case you have one.
- You must have physical original copies of your main KYC documents, primarily your PAN card, Aadhaar card with correct current address, to be able to complete video KYC.
What are the charges involved in a personal loan?
A bank or NBFC charge processing fees, stamp duty, and other regulatory fees on a personal loan.
Also, there will be a pre-payment or pre-closure fee imposed depending on the lender. Individuals who are opting should make sure to go through the many forms of charges that may be imposed before taking out a personal loan.
