When you face a sudden paucity of cash and have no immediate inflow in sight, knocking on a bank’s door to seek personal loan seems like a natural thing to do for most of us.
When you decide to raise a personal loan, it is rational to compare the interest rates charged by most lenders before you zero in on the one that suits your needs.
Usually, most lenders charge a lower rate from borrowers with a high credit score and a high interest rate from the ones who have a low credit score.
Let us take a look at which banks charge which interest rates.
Top 5 banks charge the lowest interest rates:
HDFC Bank: HDFC Bank charges interest rate that ranges between 10.75 percent to 24 percent per annum on the loans it disburses. The processing fees for the loan is ₹4,999 plus GST. The loan tenure is between 3 to 72 months. The bank gives a loan up to ₹40 lakh
ICICI Bank: ICICI Bank charges anywhere between 10.65 to 16 percent per annum on loans. The loan processing charges of loan are up to 2.50 percent of loan amount plus applicable taxes.
(Source: Banks’ websites, lowest rates are offered to borrowers with high credit score)
State Bank of India (SBI):SBI charges interest rate that starts from 11.15 percent. The state lender lends loans up to ₹20 lakh even to customers who don’t have a bank account with SBI.
Kotak Mahindra Bank: Kotak Mahindra Bank gives personal loans in the range of ₹50,000 to ₹40 lakh at an interest rate that starts at 10.99 per cent. The loan processing charges are up to 3 percent of loan amount plus applicable taxes.
PNB: Punjab National Bank (PNB) charges 12.75 to 16.25 percent based on the credit score from corporate employees. Lowest interest rate on personal loans disbursed to government employees is 11.75 percent. The lowest rate for defence personnel is 11.40 percent.
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The best personal loan rates are currently from 6.99% to 35.99%. Compare interest rates on personal loans from online lenders, banks and credit unions. The lowest rates go to borrowers with strong credit histories, high incomes and low existing debt. 35+ personal loans reviewed and rated by our team of experts.
According to a Bankrate study, the average personal loan interest rate is 12.22 percent as of April 24, 2024. However, the rate you receive could be higher or lower, depending on your unique financial circ*mstances. Personal loan rates vary based on creditworthiness, the lender and the borrower's financial stability.
Unlike many banks, Bank of America does not offer personal loans. It has quite a few credit card options — and a small loan for unexpected expenses — but you will need to look elsewhere if you want to borrow a large personal loan.
The average personal loan interest rate for consumers with good credit (690 to 719 credit score) is 14.84%, according to aggregate, anonymized offer data from users who pre-qualified for a personal loan through NerdWallet.
Huntington Bank's application process for personal loans is straightforward, especially for current customers. An advantage is the ability to check rates without affecting your credit score. A full application will involve a hard credit inquiry, which can affect your credit score.
Lower personal loan rates may be on the horizon in 2024 after the Fed made progress curbing inflation at the end of 2023. That progress came after four more Federal Reserve rate hikes in 2023.
Zero-interest loans are typically facilitated through third-party lenders, not by the stores themselves. These lenders may have specific eligibility criteria that borrowers must meet to qualify for 0%-interest personal loans, such as a certain minimum credit score, income level, and employment history.
It is important to note that even though a loan may not carry any interest, it is not necessarily free. However, the terms may vary from lender to lender. Many lenders may charge an extra fee to offer an interest-free personal loan.
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