Personal Loan

How to get Personal Loan in Online? Personal loan are utilized by the people who are in immediate financial need for type of personal expense. The financial institutions namely the banks provide the personal loans. Information on application, process, pros and cons, interest rates of the personal loan are brought into light in the below article. Check this article to get to know the detailed information about personal loans.

Last modified:2019-04-25


You Can Also Search for Personal Loan

#1. HDFC Personal Loan EMI Calculator
#2. Personal Loan Calculator
#3. Personal Loan Eligibility
#4. HDFC Personal Loan Interest Rate
#5. Loan Against Property
#6. SBI Personal Loan Interest Rate
#7. Bajaj Finance Personal Loan
#8. HDFC Personal Loan Status
#9. Personal Loan Interest Rates
#10. ICICI Personal Loan
#11. Axis Bank Personal Loan
#12. HDFC Personal Loan
#13. SBI Personal Loan

What is a Personal Loan?

With the rise in the cost of living of the people, the people are in need of financial help to meet their personal expenditures. Personal expenses which involve a high sum of the amount can be met only with a help of personal loans provided by the financial institutions. Banks help their customers by providing personal loans at a certain rate of interest and processing fees. This personal loan is given with an agreement of repayment to be done within a specified tenure. The time period may vary for each personal loan from 1 to 5 years. Mostly personal loans are provided for short and medium term financial requirements. All banks and  financial institutions provide personal loans at attractive interest rates. Some banks keep the processing charges at bay to attract many customers. Personal loans are sometimes a boon to the people for any emergency needs like  hospitalisation of any family member. The processing period of the personal loan is  also less and the personal loans are sanctioned with minimal procedures. Some of the highlighted details related to personal loans are provided in the below table.
 
Interest rate 10.75% - 35%
Processing fees Ranges between 1% to 3% of the loan amount and it varies from bank to bank
Loan amount Rs.15000 to Rs.50 lakhs
Loan tenure 12 months to 60 months
Preclosure charges Mostly 2% to 5% on the outstanding loan amount
Guarantor requirement May be required on different situations
Lock-in period Varies from lender to lender


What are the Interest Rates of Different Personal Loan?

The interest rate of the personal loan varies from bank to bank. Most of the banks charge 10.75% onwards for the personal loan amount. The interest rates also changes based on the loan amount, loan repayment period and the income of the applicant. Age of the applicant is also considered when the personal loan interest rates are decided. The personal loans interest rates for different types of personal loans are given in the below table.
 

Types of personal loan

Interest Rates

Business loan

7.9%-19.9%

Home improvement loan

9%-12.5%

Marriage loan

13.49%-34%

Same day loans, loans for unemployed

Very high interest rate

Who is Eligible to Apply for a Personal Loan?

There are eligibility criteria for availing the personal loan which slightly varies for different financial institutions. Different banks have different checklist to be fulfilled for obtaining a personal loan. To avoid rejection, check if you are eligible for a respective bank personal loan by providing details at the eligibility check calculator online.  Also the limits of the personal loan vary for salaried people and self-employed people. To be eligible for obtaining a personal loan, one should fulfill the following table.
 
Employment Type
  • Salaried
  • Self - Employed
Age limit 21 years - 58 years
Monthly net income
  • Rs.15000 in non-metro cities
  • Rs. 20000 in metro cities
Loan amount Upto Rs. 50 lakhs based on credit score of the applicant
Credit score 750 or above
Stability of work
  • Salaried
Should have been employed at the current employer for at least 6 to 12 months
  • Self - Employed
Business must have been done for at least 3 years and should have filed for income returns for last 3 years.
Period of stay in the current residence Should have stayed in the current residence for at least 3 years.

What are the Documents Required to Apply for a Personal Loan?

One has to search for the interest rates and processing fees of different banks before considering for the personal loan. Once decided about the bank, the personal loan application form is to be obtained and duly filled. Fill in the details in block letters for easy understanding. Provide accurate information in the personal loan application form. Affix a photograph in the space given in the personal loan application form and sign it or provide thumb impression at the required places. The following documents are to be produced for applying for the personal loan along with the application form.

Documents for Salaried Applicants

1.       Identity proof

2.      Age proof

3.      Completed loan application form with passport size photo affixed

4.      PAN Card

5.      Address proof

6.      Bank statements of last 3 months

7.      Salary slips of last 3 months

8.     Income tax returns of last 3 years or Form 16

Documents for Self- Employed Applicants

1.       Identity proof

2.      Age proof

3.      Completed loan application form with passport size photo affixed

4.      PAN Card

5.      Address proof

6.      Bank statements of last 3 months

7.      Income tax returns of last 3 years with the computation of income

8.     Audited Balance Sheet and Profit and Loss Account of last 3 years

Some of the identity proof which can be submitted for the personal loan application are as follows.

●       Aadhar card

●       Voter ID

●       Employer provided ID Card

●       Passport

●       Ration card

●       PAN Card

Some of the proof of Age documents which are accepted by the banks and financial institutions for personal loan application are as follows.

●       Birth certificate

●       SSLC certificate

●       Aadhar card

●       Passport

●       PAN Card

●       Voter ID

●       LIC Policy

●       Ration card

Some of the proof of Address documents which are accepted by the banks and financial institutions for personal loan application are as follows.

●       Aadhar card

●       Ration card

●       EB Bill

●       Telephone bills

●       Property documents

●       Rental agreements

What are the Types of Personal Loan?

There are many types of personal loans provided by the financial institutions depending upon the needs of the people. Some banks provides different personal loan schemes that can be altered to the convenience of the people. The personal loan helps people to meet immediate financial requirements and the rate of interest varies from bank to bank. Some of the personal loans provided to the people are as follows.
  • Medical loan
  • Home improvement loan
  • Corporate loan
  • Small business loans for woman
  • Govt. Loans for small scale business
  • Business startup loan
  • Loans for unemployed
  • Personal loan for low Cibil Score
  • Marriage loan

List of Best Personal Loans in India and Highlighted Information

Nowadays mostly all the banks and financial institutions provide personal loans at different interest rates. Few best personal loans in India are listed in the below given table.
 
Bank name Interest rates Loan amount
Yes bank 10.75% - 16.99% 1 lakh to 25 lakhs
ICICI bank 11.50% - 16.75% Rs.50000 to 25 lakhs
HDFC bank 10.99% - 20% Rs.50000 to 40 lakhs
Kotak bank 11% - 24% 1 lakh to 30 lakhs
Tata Capital 11.75% - 19% Rs.75000 to 2 lakhs
IndusInd bank 11.49% - 20% 1 lakh to 20 lakhs
IDFC bank 11.69% - 15% 1 lakh to 20 lakhs
Bajaj Finserv 12% - 16% 1 lakh to 20 lakhs
IIFL 12.99% - 20% 1 lakh to 20 lakhs
Capital First 12% - 35%
(Working women in Category A and B - interest rate is 10.65%)
1 lakh to 15 lakhs
 
Highlighted Information related to Yes Bank Personal Loan
Some of the highlighted information related to personal loan provided by Yes Bank are given in the below table.
 
Interest rates 10.75% - 16.99%
Age 22 years to 60 years (during loan maturity)
Loan tenure 12 to 60 months
Processing fees Upto 2.50% of loan amount plus taxes
Prepayment or preclosure charges 13 - 24 months - 4% of principal amount outstanding
25 - 36 months - 3% of principal amount outstanding
37 - 48 months - 2% of principal amount outstanding
Lock in period 12 months
 
Highlighted Information related to ICICI Bank Personal Loan
Some of the highlighted information related to personal loan provided by ICICI Bank are given in the below table.
Interest rates 11.50% - 16.75%
Age 23 years to 58 years (during loan maturity)
Loan tenure 12 to 60 months
Processing fees Upto 2.25% of loan amount plus taxes
Prepayment or preclosure charges Upto 5% of loan amount outstanding plus taxes
Lock in period 6 months
 
Highlighted Information related to HDFC Bank Personal Loan
Some of the highlighted information related to personal loan provided by HDFC Bank are given in the below table.
 
Interest rates 10.99% - 20%
Age 21 years to 60 years (during loan maturity)
Loan tenure 12 to 60 months
Processing fees Upto 2.50% of loan amount of minimum Rs.1499 and maximum Rs. 25000 plus taxes
Prepayment or preclosure charges 13 - 24 months - 4% of principal amount outstanding
25 - 36 months - 3% of principal amount outstanding
37 - 48 months - 2% of principal amount outstanding
>48 months - No charges
Lock in period 12 months
 
Highlighted Information related to Kotak Bank Personal Loan
Some of the highlighted information related to personal loan provided by Kotak Bank are given in the below table.
Interest rates 11% - 24%
Age 21 years to 58 years (during loan maturity)
Loan tenure 12 to 48 months
Processing fees Upto 2.5% of loan amount plus taxes
Prepayment or preclosure charges Upto 5% of loan amount outstanding plus taxes
Lock in period 12 months
 
Highlighted Information related to Bajaj Finserv Personal Loan
Some of the highlighted information related to personal loan provided by Bajaj Finserv are given in the below table.
Interest rates 12% - 16%
Age 25 years to 58 years (during loan maturity)
Loan tenure 12 to 60 months
Processing fees Upto 3.99% of loan amount plus taxes
Prepayment or preclosure charges Upto 4% of loan amount outstanding plus taxes
Lock in period 1 month
 
Highlighted Information related to IIFL Personal Loan
One can get the personal loan quickly from IIFL as it completes verification and disperses loan amount very quickly. Some of the highlighted information related to personal loan provided by IIFL are given in the below table.
Interest rates 12.99 % - 20 %
Age 21 years to 60 years (during loan maturity)
Loan tenure 12 to 60 months
Processing fees Upto 2% of loan amount plus taxes
Prepayment or preclosure charges Upto 4% of loan amount outstanding plus taxes and no charges after 12 months
Lock in period 9 months

What are Important Aspects to Consider Before Applying for a Personal Loan?

The personal loans can be availed for almost any kind of expenditure. One has to consider certain things before applying for the personal loan. The loan amount and repayment duration must be taken into consideration as this is the primary step. The applicant must search for the correct bank at which he/she fits in the eligibility criteria of the bank. Before applying for the personal loan, calculate the EMI using the EMI Calculators available online for different banks. EMI Calculations helps to pre-plan the monthly expenses and need not suffer at the time of repayment of the personal loan. The processing time, interest rate and processing fees of the personal loan must be taken into account before applying for the personal loan. Re-check the proof document copies before submission to eliminate unnecessary rejection of personal loan. To be on the safer side, double check the details filled in the personal loan application form. The required documents are to be submitted with the application form are to be made ready for a successful sanction of the loan.

What are the Different Stages in Personal Loan Processing?

Once the applicant submits all the required documents along with the application form, the processing and verification is done by the financial institutions. Once all the verification is done and if the application fits with all the eligibility criteria, then the personal loan is sanctioned. Otherwise, the personal loan is rejected. If the approval is given for the personal loan, the agreement must be signed and finally the loan is provided. The overall processing period differs between different banks. Mostly the personal loans are sanctioned maximum within a week. The banks and financial institutions charge a nominal fee for the processing of the personal loan. In some banks like Citi Bank and HDFC Bank provides same day loans for any emergency needs. In that case, the personal loan processing is done within minutes. 

How to Calculate the Personal Loan EMI using EMI Calculator?

The applicant before applying for a personal loan must have an idea about the EMI that is to be paid every month for the loan amount. There are many online personal loan EMI calculator which helps to ascertain the amount which is to be paid monthly as EMI. The EMI calculation helps the applicant to decide if he/she can manage the monthly financial requirements. Follow the below instructions to calculate the personal loan EMI.
  • Search for the bank’s official website in which you are planning to approach for personal loan.
  • Choose the EMI Calculator from menu.
  • Enter the loan amount, loan tenure and interest rate.
  • Choose “Calculate EMI” to know the approximate figure of the EMI amount.
  • The EMI amount is displayed within few seconds.

What are the Merits of the Personal Loan?

People are benefited to a certain limit through the personal loans. Personal loans help the people to meet their financial needs. Personal loans which has minimal procedures saves majority of the people who are in financial crisis. Some of the benefits of the personal loan are given as follows:
  • The personal loan helps the people to achieve their dreams of buying a property, construct a house, plan for a vacation, etc.
  • The loan amount is easily sanctioned if the person fits to the criteria fixed by the bank.
  • The processing is also done quickly by the financial institutions.
  • Some banks do not ask any collateral security for sanctioning the loan amount.
  • The repayment of loan amount are flexible in certain banks which helps the applicant.

What the Demerits of the Personal Loan?

Though the procuring of personal loans has various benefits, it has its own limitations. Sometimes people are pushed to many problems when they are unable to  repay the personal loan amount. The easy procurement of personal loan though being a boon, sometimes it attracts people to obtain personal loans unnecessarily which leads to problems. Some of the demerits of obtaining a personal loan are as follows.
  • The interest rate for the personal loan is very extremely high.
  • The processing fees charged for the personal loan is high.
  • In case of failure of repayment of personal loan, the financial institutions take strict steps to get back the loan amount.

Who Can Apply for a Personal Loan?

Any individual who runs a business or salaried people can apply for a personal loan. Even unemployed person can apply for a personal loan, but banks would sanction it only with some mortgage as security. Also the personal loan for unemployed people charges high rate of interest. One can get a personal loan if he/she can repay it in a specified period of time. Some banks provide personal loans even for NRI. People who already have taken other loans can also apply for a personal loan but should have a high credibility of repaying the personal loan. Applicant should be minimum 21 years to apply for a personal loan. To encourage women in the entrepreneurship world, the banks provide personal loans with low rate of interest for women to start up a business. One who is applying must have a good credit history in banks for obtaining a personal loan.

Who Provides the Personal Loan?

There are lots of financial institutions that provide the personal loans for the people. Some of the banks or financial institution provides only certain kinds of personal loans.Also the interest rates of personal loans vary for different banks. ICICI Bank, Small Industries Development Bank of India (SIDBI) and India Finance Corporation Of India (IFCI), Kotak Mahindra, TATA Capital, Standard Chartered, Bank of Baroda, Oriental Bank, etc. provide business start up loans. Citibank and HDFC Bank provide same day loans. Government provides loans for small scale business at lower rate of interest. There are various other banks and other financial institutions which sanction many other kinds of personal loans. Most of the banks which provides the personal loans also provide 24/7 hours customer care assistance to help their customers. Some banks even eliminate extra charges like the pre-closure and foreclosure charges for encouraging the customer to repay the personal loan on time. 

 

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