If you are planning to take a loan, the first thing you must understand is the personal loan rate of interest, because even a 1% difference can cost or save you tens of thousands of rupees over the loan tenure.
Rates range from 9.99% to 26% per annum across banks and NBFCs, depending on your credit score, monthly income, employer category, and repayment history.
This guide gives you the complete picture, the latest bank wise personal loan interest rate comparison, CIBIL score impact, RBI repo rate connection, foreclosure charges, and proven tips to get the lowest personal loan interest rate possible.
If you're wondering which bank has the lowest interest rate on personal loan in India, or simply want to know the exact personal loan percentage rate for your income and credit profile, our bank-wise table below answers that in detail.
How Much Interest Rate for Personal Loan?
Every bank prices its personal loan rate of interest in all banks differently, based on your income, credit score, and existing relationship with the lender. Public sector banks usually stay lower, while NBFCs charge more but approve faster.
Understanding the personal loan percentage rate before applying helps you avoid overpaying. So how much interest rate for personal loan can you expect? Most salaried applicants with a good credit score get offers between 10% and 16% p.a. Even a small gap in rate across lenders adds up to real savings over your full repayment tenure.
Note: Personal loan interest rates start from 9.99% p.a. Salaried borrowers with a CIBIL score above 750 typically get rates between 10.40% to 13% p.a. Government employees and defense personnel often qualify for the lowest rates.Personal Loan Interest Rate – Bank Wise Comparison
Wondering what is current interest rate on personal loans? Below is the most updated bank wise comparison table covering public sector banks, private banks, and NBFCs, so you can check the average personal loan interest rate before choosing a lender.
| Bank / Lender | Interest Rate p.a. | Loan Amount | Tenure |
|---|---|---|---|
| IDFC FIRST Bank | 9.99% – 24% | ₹10,000 – ₹10,00,000 | 6 – 84 months |
| HDFC Bank | 9.99% – 24% | ₹50,000 – ₹50,00,000 | 12 – 60 months |
| ICICI Bank | 9.99% – 16.50% | ₹50,000 – ₹50,00,000 | 12 – 60 months |
| Axis Bank | 9.99% – 22% | ₹50,000 – ₹40,00,000 | 12 – 60 months |
| Kotak Mahindra Bank | 9.99% – 24% | ₹50,000 – ₹40,00,000 | 12 – 60 months |
| SBI | 11.15% – 15.40% | ₹25,000 – ₹20,00,000 | 6 – 84 months |
| Bank of India | 11.10% – 14.85% | ₹50,000 – ₹25,00,000 | 12 – 60 months |
| Bank of Baroda | 11.60% – 17.95% | ₹50,000 – ₹20,00,000 | 12 – 60 months |
| Punjab National Bank | 11.80% – 15.35% | ₹50,000 – ₹20,00,000 | 12 – 60 months |
| Federal Bank | 11.99% – 17.49% | ₹50,000 – ₹40,00,000 | 12 – 60 months |
| IndusInd Bank | 10.49% – 24% | ₹30,000 – ₹50,00,000 | 12 – 60 months |
| Yes Bank | 10.70% – 24% | ₹1,00,000 – ₹40,00,000 | 12 – 60 months |
| Bajaj Finance | 10.99% – 26% | ₹30,000 – ₹40,00,000 | 12 – 96 months |
| Tata Capital | 10.99% – 24% | ₹75,000 – ₹35,00,000 | 12 – 72 months |
| Muthoot Finance | 14% – 22% | ₹50,000 – ₹15,00,000 | 12 – 60 months |
| Mahindra Finance | 14% – 26% | ₹50,000 – ₹10,00,000 | 12 – 60 months |
Note: Rates are updated regularly. Actual rates depend on individual credit profile. Always confirm with the lender before applying.
Pro Tip – Before you finalise any bank, compare monthly payments at different interest rates side by side. A 1% rate difference on a ₹5 lakh loan can mean ₹800 more every month.What Is Personal Loan Rate of Interest?
Personal loan interest rate also called personal loan ROI, is the annual cost a bank or NBFC charges on the amount you borrow, expressed as a percentage per annum. Since personal loans are unsecured, this rate depends entirely on your creditworthiness, the stronger your profile, the lower your rate.
Most lenders calculate it on a reducing balance basis, interest applies only to your outstanding principal after each EMI, not the full loan amount. There are two types:
Fixed vs Floating Personal Loan Interest Rate
- Fixed Rate – stays constant for the entire tenure, easy to budget.
- Floating Rate – moves with RBI's repo rate or the bank's MCLR, rare in personal loans.
Most personal loans in India run on a fixed rate, so the number you see at signup is what you pay till closure.
Personal Loan Interest Rate - ( Bank Interest Details )
Here is the personal loan interest rate per annum and average personal loan percentage rate for the banks with the lowest offers right now:
1. IDFC FIRST Bank
IDFC FIRST Bank offers the lowest personal loan interest rate at 9.99% per annum for eligible borrowers. Their FIRSTmoney product gives loans from ₹10,000 to ₹10 lakh with flexible tenure up to 60 months. Even first-time borrowers with limited credit history have a decent chance of approval here.
2. HDFC Bank
HDFC Bank is ideal for existing customers. If you hold a salary account or a credit card with them, you may get a pre-approved offer with rates starting at 9.99%. Disbursal happens in as little as 10 seconds for pre-approved customers.
Processing fee is capped at ₹6,500 + GST regardless of loan amount, which is a plus for larger loans.
3. ICICI Bank
ICICI Bank offers instant personal loan interest rate deals starting at 9.99% with tenures up to 60 months.
Salary account holders often get instant disbursal within minutes of applying through the iMobile app. Their reducing balance calculation also keeps the actual interest cost lower than it looks on paper.
4. SBI - Personal loan interest rate SBI
The SBI Bank personal loan interest rate starts at 11.15% p.a., one of the most competitive among PSU banks. It is ideal for government employees, defense personnel, and pensioners.
SBI's Xpress Credit scheme offers rates from 11.15% for salary account holders. Processing fee is just 1.50% and part prepayment is allowed after 6 months without heavy penalties.
5. Kotak Mahindra Bank
The Kotak Mahindra Bank personal loan interest rate starts at 9.99% p.a. Kotak is known for quick digital processing and pre-approved offers for existing customers. A ₹50,000 loan at 9.99% for 24 months gives an EMI of approximately ₹2,300 per month, with total interest of around ₹5,200.
6. Mahindra Finance
Mahindra Finance primarily serves rural and semi-urban borrowers. The Mahindra Finance personal loan interest rate ranges from 14% to 26% p.a. depending on borrower profile and location.
It is a strong option for tier 2 and tier 3 city borrowers where major banks have limited reach. Minimum salary required is ₹15,000 per month and only Aadhaar and PAN are needed.
7. Axis Bank
Axis Bank offers a competitive personal loan rate of interest starting at 9.99% p.a. for salaried professionals with a strong credit profile. Existing account holders often get pre-qualified offers with minimal documentation and disbursal within 24 hours.
8. Bank of India
As a public sector lender, Bank of India keeps its lending rate in the 11.10% to 14.85% p.a. range, making it a reliable option for salaried and pensioner applicants who prefer a government-backed bank.
9. Bank of Baroda
Bank of Baroda's loan interest rate starts at 11.60% p.a. and suits government employees and long-standing account holders, who often qualify for the lower end of the 11.60% to 17.95% range.
10. Punjab National Bank
PNB prices its loan rate of interest between 11.80% and 15.35% p.a. It is a preferred choice among government and PSU employees due to relaxed eligibility and lower processing charges.
11. Federal Bank
Federal Bank's interest rate on personal loans starts above 11.99% p.a. and works well for applicants in South India with a stable salary account, though its rate range runs up to 17.49% depending on profile.
12. IndusInd Bank
IndusInd Bank offers a personal loan rate of interest from 10.49% p.a., with quick digital approval for salaried applicants earning above ₹25,000 a month and a healthy CIBIL score.
13. Yes Bank
Yes Bank's loan interest rate begins at 10.70% p.a., aimed at higher-ticket borrowers, since the minimum loan amount starts from ₹1,00,000 with tenure up to 60 months.
14. Bajaj Finance
Bajaj Finance, one of India's largest NBFCs, offers a personal loan ROI from 10.99% p.a. with same-day disbursal and tenure options up to 96 months, the longest among lenders in this comparison.
15. Tata Capital
Tata Capital's interest rate on personal loans starts at 10.99% p.a., with loans up to ₹35 lakh and flexible tenure up to 72 months, suited for borrowers needing a higher loan amount.
16. Muthoot Finance
Muthoot Finance charges a personal loan interest rate between 14% and 22% p.a. and is best suited for borrowers in tier 2 and tier 3 towns where branch access matters more than the lowest rate.
Personal Loan Interest Rate for Government & Salaried Employees
Government employees, PSU staff, and defense personnel usually get the lowest personal loan interest rate for government employees because banks see them as low-risk borrowers with stable income. SBI, PNB, and Bank of Baroda offer preferential rates starting near 11.15% p.a. for this segment, along with lower processing fees and relaxed eligibility norms.
RBI Guidelines on Personal Loan Interest Rate
Many people ask, does RBI set personal loan interest rates? The answer is no, not directly. But the RBI plays a huge indirect role. Here is how it works.
- RBI sets the Repo Rate, which is the rate at which it lends to banks. When repo rate goes up, banks raise their lending rates. When it falls, loan rates usually drop.
- Banks use MCLR (Marginal Cost of Funds based Lending Rate) as a base to price their loans. Personal loan rates are set above MCLR based on the borrower's risk profile.
- RBI mandates that banks must clearly disclose the Annual Percentage Rate (APR), which includes all charges, not just interest. This protects borrowers from hidden costs.
- RBI's guidelines also restrict banks from charging unfair prepayment penalties on floating rate loans.
- NBFCs are regulated by RBI under a separate framework but are also bound to disclose their Annual Percentage Rate (APR) clearly before loan disbursement.
- RBI's Fair Practices Code requires every lender to communicate the interest rate, processing fee, and all other charges in writing before you sign the loan agreement.
How to Get the Lowest Personal Loan Interest Rate
Getting the best rate is not luck, it takes preparation. Here are the most effective steps you can take.
Step 1 – Improve Your CIBIL Score Before Applying
If your score is below 750, spend 3–6 months improving it before applying. Pay bills on time, reduce existing debt, and avoid new credit inquiries. This one step alone can save you 2–4% on your rate which means thousands of rupees saved over the loan tenure.
Step 2 – Compare Personal Loan Interest Rates Across Multiple Banks
Never apply to just one bank. Get quotes from at least 4-5 lenders, and always compare total repayment amount, not just the monthly EMI.
Step 3 – Negotiate Interest Rate With Your Existing Bank
Your existing bank already knows your transaction history and income pattern. This gives them confidence. Interest rate negotiation works best with your own bank, many offer 0.25 to 0.50% rate reductions to existing account holders. You can also negotiate a processing fee waiver. Always start here and then use competitor quotes to bargain further.
Step 4 – Choose the Right Loan Amount and Repayment Tenure
Borrow only what you genuinely need. Shorter tenures (24–36 months) attract slightly better rates and result in much lower total interest paid.
Step 5 – Apply During Bank Festive Offers for Lower Rates
Banks run special loan campaigns during Diwali, New Year, and financial year-end (March). These limited-period offers can give you 0.5–1% lower rates. Subscribe to bank newsletters or check their websites in October–December and March–April for such offers.
Step 6 – Add a Co-Applicant to Improve Loan Eligibility
Adding a co-applicant with a strong credit score and stable income can significantly improve your rate, especially if your individual profile is average. This works well for married couples where both are salaried. The combined income also increases the maximum loan amount you qualify for.
Personal Loan EMI Calculation Example
Once you know your personal loan rate of interest, the next step is checking your monthly EMI. For example, a ₹5,00,000 loan at 10.5% p.a. for 5 years gives an EMI of around ₹10,747 per month. Use our free EMI Calculator to check your exact EMI instantly by entering your loan amount, interest rate, and tenure.
Top 10 Best Personal Loan Apps With Low Interest Rate
If you prefer applying for a personal loan at low interest rate through your phone, several RBI-registered apps offer competitive rates with instant disbursal. Below are the top 10 personal loan low interest rate apps compared on rate, loan amount, tenure, and Play Store rating.
| Loan App | Interest Rate p.a. | Loan Amount | Tenure | Rating |
|---|---|---|---|---|
| Navi | 9.9% onwards | ₹10,000 – ₹20,00,000 | 3 – 72 months | ⭐ 4.5 |
| KreditBee | 12% – 28.5% | ₹6,000 – ₹10,00,000 | 3 – 24 months | ⭐ 4.4 |
| MoneyTap | 13% – 36% | ₹3,000 – ₹5,00,000 | 2 – 36 months | ⭐ 3.9 |
| Aditya Birla Capital | 10.99% – 30% | ₹50,000 – ₹40,00,000 | 12 – 84 months | ⭐ 4.3 |
| PaySense | 14% – 36% | ₹5,000 – ₹5,00,000 | 3 – 60 months | ⭐ 3.0 |
| Kissht | 14% – 36% | ₹35,000 – ₹5,00,000 | 3 – 72 months | ⭐ 4.6 |
| Paytm Personal Loan | 12% – 35% | ₹10,000 – ₹5,00,000 | 3 – 24 months | ⭐ 4.2 |
| mPokket | 0% – 4% per month | ₹500 – ₹50,000 | 61 – 120 days | ⭐ 4.1 |
| StuCred | 0% | ₹1,000 – ₹30,000 | 30 days | ⭐ 4.0 |
| CASHe | 27% – 33% | ₹1,000 – ₹4,00,000 | 3 – 18 months | ⭐ 4.3 |
Among all apps, Navi offers the lowest personal loan interest rate starting at 9.9% p.a., ideal for borrowers with a CIBIL score above 700. For a detailed review of each app, read our full guide on best personal loan app.
Personal Loan Rate of Interest – FAQs
1. What is the personal loan rate of interest in 2026?
Rates range from 9.99% to 26% p.a. IDFC FIRST Bank, HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank all offer the lowest starting rate at 9.99% p.a.
2. Which bank has the lowest personal loan interest rate?
IDFC FIRST Bank, HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank all lead at 9.99% p.a. onwards.
3. How does CIBIL score affect personal loan interest rate?
A score above 750 gets you 9.99% to 13%. A score of 650 to 750 attracts 13% to 20%. Below 650 usually means rejection or rates above 20%.
Conclusion
The personal loan rate of interest starts from 9.99% p.a. and can go up to 26%, depending on the bank, your CIBIL score, income, and existing relationship with the lender. IDFC FIRST, HDFC, ICICI, Axis, and Kotak Mahindra all currently offer the lowest starting rate.
Compare at least 3 to 4 lenders before applying, keep your CIBIL score above 750, and always check the total repayment cost, not just the headline rate. A small difference in rate can save you thousands over the loan tenure.
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