Financial emergencies can happen at any time. Thankfully, there are several financing options available in the market which can come to your rescue at such a time. Personal loans, loans against securities, loans against fixed deposits, and loans against gold are some of the popular options available. However, the most popular option, owing to its convenience, is the personal loan.
Personal loans are a type of unsecured loan which can be taken for a variety of purposes. Unlike secured loans, such as a car loan or home loan, which require collateral, personal loans are typically granted based on the borrower’s creditworthiness and repayment ability.
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Personal loans can be used for a variety of purposes, such as consolidating debt, making an expensive purchase, covering unexpected expenses, home renovations, or funding your children’s education. However, the end use of a personal loan is seldom restricted and borrowers can use it for any legally-approved purpose.
Personal loans, like other loans, are repaid in equated monthly instalments or EMIs. The EMI, however, will depend on the loan amount, repayment tenure, and the rate of interest. Some lenders also allow prepayment on personal loan without charging a penalty for the same.
When shopping or a personal loan, it is essential that you compare what different lenders may be offering. Carefully review the terms of the loans such as the rate of interest, repayment tenure, and fees associated with the loan. Also, before you decide to take a loan, assess your requirement and repayment capacity for making EMI payments before committing to a lender. Borrow only as much as you need. It is not financially wise to take on a loan that will push you into deeper debt and destabilise your finances.
With the festive season upon us, a personal loan can be useful for making big-ticket purchases affordable. So, if you are looking to take a person loan, the table below lists 10 banks which are currently offering the lowest interest rates on personal loans of Rs.3 lakh for two years. The table also illustrates the EMI you would have to bear for the loan at different interest rates. Please note that the interest rates applicable to you could be higher based on your loan amount, tenure, credit score or any other terms and conditions of your chosen lender.
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| Bank Name | Lowest Advertised Interest Rates On A Personal Loan | EMI (2 Year Tenure) |
| Bank of Maharashtra | 10.00% | ₹ 13,843 |
| Indian Bank | 10.00% | ₹ 13,843 |
| Punjab & Sind Bank | 10.15% | ₹ 13,864 |
| Kotak Bank | 10.25% | ₹ 13,878 |
| Bank of India | 10.25% | ₹ 13,878 |
| Punjab National Bank | 10.40% | ₹ 13,899 |
| IDFC Bank | 10.49% | ₹ 13,911 |
| IndusInd Bank | 10.49% | ₹ 13,911 |
| Axis Bank | 10.49% | ₹ 13,911 |
| HDFC Bank | 10.50% | ₹ 13,913 |
Disclaimer: Data collected from respective institution’s website as on Oct 17, 2023. Interest rates on personal loan for all listed (BSE) public and private banks and select NBFCs were considered for data compilation. Banks for which data is not available on their website were not considered. Banks and NBFCs are listed in ascending order on the basis of interest rate in their respective category, i.e. bank offering lowest interest rate on personal loan is placed at top and highest at the bottom. EMI is calculated on the basis of Interest rate mentioned in the table for Rs. 3 lakh Loan with tenure of 2 years (processing and other charges are assumed to be zero for EMI calculation). Interest and charges mentioned in the table is indicative and it may vary depending on bank’s terms and conditions.
