Need instant cash? Discover 25 banks offering personal loans at the lowest interest rates
Personal loans are mostly an attractive proposition as they are disbursed instantly with minimal documentation process.
Getting cash instantly in your bank account can help you deal with an immediate financial emergency or meet any other requirement. Often people find themselves short of funds when a crisis hits them. This is when the personal loan could come to your rescue.
A personal loan is a type of unsecured loan that you can borrow if you need funds to pay for your financial needs such as medical emergency, education, marriage, and even travel, among others. Lenders generally offer personal loans for a term between 1 and 5 years. Personal loans are mostly an attractive proposition as they are disbursed instantly with minimal documentation process.
First, you choose a lender and apply for a personal loan. The lender will verify your application and do a thorough check of your credit history and income to assess your ability to repay. The personal loan amount you can take out will also be calculated based on your annual and monthly income, as well as factors such as your credit history and income on hand.
The maximum amount a bank or financial institution will offer as a personal loan varies from company to company. However, some lenders offer up to Rs 50 lakh but you should only take out the loan to meet your existing needs as borrowing more than your repayment capacity can hurt your credit score if you are late or default.
A useful rule of thumb is that you check all other fees as well as interest when taking out a personal loan. Prepayment charges if any, processing fees and legal fees and other hidden charges involved, you must get clarity on the same with your lender without hesitation. Also, some lenders may allow you to prepay your personal loan only after 1 year. You should dispel all your doubts about these conditions, according to Bankbazaar.
If you have funds available after a few months or years of personal loan, you may want to consider repayment as this may lower your overall interest on the loan. You can either opt for EMI reduction or tenure, depending on your situation. A shorter term for a personal loan is often advisable as the total interest you pay will be much less compared to longer term loans.
Selecting a personal loan may seem easy, but do all the basic due diligence to understand all the pros and cons. Personal loans can carry a high interest rate because banks or financial institutions take on a higher risk by disbursing funds without any collateral. You can avail personal loans instantly even with basic eligibility. Therefore, it is advisable to dwell on factors such as interest rate, EMIs, tenure, and the financial institutions you will be borrowing from. Comparing interest rates and other terms and conditions can help you save extra money and make a hassle-free repayment.
Here is a list of 25 banks that are currently offering the lowest interest rates on personal loans of Rs 5 lakh for a term of five years and the indicative EMIs you will have to pay. Keep in mind that the interest rates applicable to you may be higher depending on your loan amount, loan term, credit score, etc.
Interest Rate and EMI on Personal Loans of Rs 5 Lakh for 5 Year Term
Compiled by: BankBazaar.com
Note: Interest rates on personal loans for all listed public and private banks (BSE) considered for data compilation; Banks whose data is not available on their website are not taken into account. Data collected from respective bank’s website as of January 18, 2022. Banks are listed in ascending order based on interest rate, i.e. the bank offering the lowest interest rate on the personal loan is placed at the top and the highest at the bottom. The EMI is calculated based on the interest rates mentioned in the table for the Rs 5 Lakh loan with a tenor of 5 years (processing fees and the like are assumed to be zero for the calculation of the EMI); The interest and charges mentioned in the table are indicative and may vary depending on the general conditions of the bank. * Rack interest rate; ** min APR from July 21 to September 21; *^for seniors.
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