Personal Loans – How To Get One At A Lower Interest Rate?

The number of people taking personal loans to meet their immediate requirements and for their purchases are rising by the day. Purchases are being converted into EMIs or Equated Monthly Instalments. The shortfalls that people go through when there is a medical emergency, investing in a property/house, meeting the educational expenses of children or while investing in a new vehicle can be met with the help of a personal loan.

Personal Loan

A personal loan is an unsecured loan that an individual takes from an NBFC or a bank to meet their personal requirements. Unlike a home loan or loan against gold, no collateral security is required to avail this loan from a bank. Banks provide these loans to an individual on the basis of certain criteria like the company he/she is working for, level of income, and credit history. A personal loan requires only a minimum amount of documentation and can be availed within a few hours.

Interest Rates For Personal Loans In India

Compared to Gold loan interest rate the interest rate for personal loans is on the higher side. This is because these loans are unsecured. On average, the interest rate on personal loans in India could be anywhere between 11%-14% on the total loan amount. Given below are the interest rates of personal loans given by some of the popular banks/NBFCs in India.

BankPersonal Loan Interest Rate
Axis Bank11.25%
HDFC Bank11.25%
SBI12.50%
ICICI Bank11.25%
Punjab National Bank12.00%
Bajaj Finserv 11.99%
Citi Bank10.99%
IDBI Bank13.20%
Federal Bank11.49%
Indian Overseas Bank12.40%
Union Bank of India12.70%

How To Get Personal Loan At A Lower Interest Rate?

The first thing that most of us consider while applying for a personal loan is the interest rate offered by different banks. There are several factors that determine the interest rates on these loans. To get a loan at a minimum rate of interest you need to keep in mind the following factors.

Your Monthly/Yearly Earnings

Considering this loan is unsecured your income is the major factor that banks take into consideration while applying for a personal loan. The higher your income the better your chances are to get a loan at the lowest possible interest rate.

Credit History

A good Credit score (CIBIL Score) and payment history are essential for banks to sanction personal loans at a low rate of interest.

The Status Of The Company That You Work For

It is easier for you to get a loan at a lower rate of interest if you work for one of the top organizations or a multinational company. 

Your Relationship With The Bank/NBFC

You are likely to get a loan at a lower rate of interest if you already maintain a savings/salary account with the bank or NBFC. Most banks practice this method to retain their good customers.

Skill For Negotiation

Long-term customers are often held in high esteem by their banks. You can surely avail good deals on personal loans from the bank/NBFC provided you have the skill to negotiate.

The personal loan interest rates vary from bank to bank. Carefully consider the interest rates of different banks and NBFCs before you choose one. It is always better to apply for a personal loan through the bank where you have a savings/salary account. You are more than likely to get the best deal when you are one of their valued customers.

This blog is maintained by the Finaura team. Finaura is a solution that will help you find the best gold loan solution from gold loan company nearest to you. If you have any queries please feel free to contact us. Call us on +91 484 2388285 or email us at [email protected]