Personal loans remain a popular tool for Indians to get money in a hurry for a variety of purposes, from medical emergencies to renovating homes. With several banks and financial institutions fighting with one another, it is necessary for an individual to be aware of the prevailing situation of interest rates and terms of lending to secure the best deal.
Loan disbursement landscape currently
Personal loans are unsecured, i.e., not secured against collateral, hence available to a wide range of borrowers. This means that such loans are distributed without any collateral from the borrower.
Further, banks and NBFCs consider the credit score, income, and existing debt-to-income ratio to determine the rate of interest. A good credit score (over 750) and spotless financial track record can lower the offered interest rate by a significant amount. Shorter loan tenures receive lower interest rates than longer ones.
Top players and their offered loan products
Following is a summary of personal loan products of top five major banks in India:
Disclaimer: Interest rates and terms of loans could change. Check with respective banks for the latest details.
Choosing the right lender
The bank or lending institution to be chosen would depend on individual needs, repayment capabilities and qualifications. Focus on opting for low interest rates or flexibility in tenure based on your condition. Utilize online loan calculators to compute EMIs and check affordability before applying.
Application process for applying for a personal loan
Now, to avail a personal loan, carefully verify your eligibility based on credit score, income, and employment status. Collect and attach supporting documents, such as identity proof, income proof, and bank statements, and fill up the application form online from the bank’s website or an online lending site as per the instructions provided by them. If in doubt don’t hesitate to reach out to the customer support center of the respective branch of the bank or financial institution.
Through adequate research, reading of offers and interest rate determinants, borrowers can make informed decisions and take advantage of the most suitable personal loan that meets their financial needs.
(Note: Raising a loan comes with its own risks. So, due caution is advised)
