Bank of Maharashtra and Bank of India are leading the way by offering the most cost-effective personal loan choices . However, prior to picking a personal loan, borrowers should conduct a comprehensive evaluation of their needs, repayment capacity, and the terms provided by various financial institutions.
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Personal Loan Interest Rates.
The interest rates on personal loans in the country are subject to continuous fluctuations, posing a challenge for borrowers in identifying the most advantageous deal. Nonetheless, a couple of banks have emerged as frontrunners in delivering competitive rates.
Bank of Maharashtra is extending the lowest personal loan interest rate at 10.00 percent. Conversely, Bank of India is presenting a rate of 10.25 percent for loans up to Rs 20 lakh.
Arpit Suri, a Chartered Accountant and personal finance expert, elucidated, “Personal loans address a broad spectrum of needs, including settling credit card payments, unforeseen financial crises, and immediate expenditures like children’s education or household essentials.
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These unsecured loans, not requiring collateral, entail interest rates contingent on variables such as the lending institution, credit score, and repayment method. Interest, computed at a fixed rate, is applied to the diminishing balance and deducted monthly from the loan account.”
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“In securing a personal loan, essential documents include proof of identification and address, along with the most recent three salary slips for income validation. Pre-approved personal loans necessitate no additional documentation for existing customers compliant with KYC regulations,” Suri added.
Here’s a snapshot of the most competitive personal loan interest rates accessible in August 2023:
- Bank of Maharashtra: Distinguished by a competitive interest rate of 10.00 percent, Bank of Maharashtra offers personal loans up to Rs 20 lakh, spanning a repayment period of 84 months.
- Bank of India: Similarly, Bank of India extends personal loans of up to Rs 20 lakh, with a repayment tenure of up to 84 months. The initial interest rate is slightly higher at 10.25 percent.
- IDFC First Bank: Catering to a broad range of loan amounts up to Rs 1 crore, IDFC First Bank provides repayment durations ranging from six to 60 months. The starting interest rate for these loans is 10.49 percent.
- IndusInd Bank: IndusInd Bank provides flexibility in loan amounts, ranging from Rs 30,000 to 25 lakh, repayable over 12 to 60 months. Interest rates fluctuate between 10.25 percent and 32.02 percent, contingent on loan particulars.
- Kotak Mahindra Bank: Dispensing personal loans ranging from Rs 50,000 to Rs 25 lakh, Kotak Mahindra Bank offers repayment periods spanning 12 to 60 months. The interest rate commences from 10.99 percent.
- Federal Bank: Tailored for those seeking higher loan amounts, Federal Bank permits borrowing up to Rs 25 lakh, featuring a 48-month repayment period. The opening interest rate for these loans is 11.49 percent.
- Bandhan Bank: With a repayment period of up to 60 months, Bandhan Bank serves as a viable choice for loans spanning from Rs 50,000 to 25 lakh. The interest rate starts at 11.55 percent.
- J & K Bank: Jammu & Kashmir Bank accommodates an extended repayment period, enabling loans from Rs 50,000 to Rs 25 lakh to be repaid over 120 months. The interest rate initiates from 12.90 percent.
- Karnataka Bank: Offering personal loans up to Rs 5 lakh with a tenure of 60 months, Karnataka Bank features a commencing interest rate of 14.12 percent.
- City Union Bank: Catering to modest loan requisites, City Union Bank furnishes personal loans up to Rs 1 lakh. However, the interest rate for these loans commences at a relatively higher 18.75 percent.
“As individuals evaluate their financial necessities and explore borrowing alternatives, it is imperative for borrowers to meticulously deliberate their needs, repayment abilities, and the terms proffered by these financial institutions prior to making a decision.
Always bear in mind that interest rates are subject to alteration and may diverge based on individual creditworthiness and other factors,” recommended Suri.
