Personal Loan Interest Rates 2024

Check the latest personal loan interest rates offered by Bajaj Finance Limited, ranging from 11% to 32% p.a. The interest rates on personal loan depend on many factors including credit score, monthly income, employment, etc. Know the best personal loan interest rates, other applicable fees and charges before applying for a loan.

Current Interest Rate on Personal Loans

Type of fee

Applicable charges

Rate of interest

11% to 32% p.a.

Processing fees

Up to 3.93% of the loan amount (inclusive of applicable taxes).

Flexi Fee

Term Loan – Not applicable

Flexi variant - A fee will be deducted upfront from the loan amount (as applicable below)

  • Up to Rs. 1,999/- for loan amount less than Rs. 2,00,000
  • Up to Rs. 3,999/- for loan amount from Rs. 2,00,000 to Rs. 3,99,999
  • Up to Rs. 5,999/- for loan amount from Rs. 4,00,000 to Rs. 5,99,999
  • Up to Rs. 7,999/- for loan amount from Rs. 6,00,000 to Rs. 9,99,999
  • Up to Rs. 8,999/- for loan amount from Rs. 10,00,000 to Rs. 14,99,999
  • Up to Rs. 9,999/- for loan amount from Rs. 15,00,000 to Rs. 19,99,999
  • Up to Rs. 10,999/- for loan amount from Rs. 20,00,000 to Rs. 24,99,999
  • Up to Rs. 11,999/- for loan amount from Rs. 25,00,000 to Rs. 29,99,999
  • Up to Rs. 12,999/- for loan amount of Rs. 30,00,000 and above

*All the Flexi charges above are inclusive of applicable taxes

*Loan amount includes approved loan amount, insurance premium, and VAS charges.

Bounce charges

Rs. 700 - Rs. 1,200 per bounce.
“Bounce charges” shall mean charges for (i) dishonour of any payment instrument; or (ii) non-payment of instalment (s) on their respective due dates due to dishonour of payment mandate or non-registration of the payment mandate or any other reason

Pre-payment charges

Full Prepayment

  • Term Loan: Up to 4.72% (inclusive of applicable taxes) on the outstanding loan amount as on the date of full prepayment.
  • Flexi Term Loan (Flexi Dropline): Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment.
  • Flexi Hybrid Loan: Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as of the date of full prepayment.

Part-prepayment

  • Term Loan: Up to 4.72% (inclusive of applicable taxes) of the principal amount of the loan prepaid on the date of such part-prepayment.
  • Not Applicable for Flexi Term Loan (Flexi Dropline) and Flexi Hybrid.

*Foreclosure will be processed post clearance of first EMI

Penal charge

Delay in payment of instalment(s) shall attract Penal Charge of Rs. 8 - Rs. 12 per day per instalment from the respective due date until the date of receipt of the full instalment(s) amount.

Stamp duty (as per respective state)

Payable as per state laws and deducted upfront from loan amount.

Annual maintenance charges

Term Loan: Not applicable

Flexi Term Loan (Flexi Dropline): Up to 0.295% (inclusive of applicable taxes) of the total withdrawable amount (as per the repayment schedule) on the date of levy of such charges.

Flexi Hybrid Loan: Up to 0.295% (inclusive of applicable taxes) of the total withdrawable amount during the initial tenure. Up to 0.295% (inclusive of applicable taxes) of total withdrawable amount during subsequent tenure.

Broken period interest / Pre-monthly Instalment interest

Broken Period Interest/Pre-monthly instalment Interest" shall mean the amount of interest on loan for the number of day(s) which is (are):

Scenario 1: Over and above the period of 30 (thirty) days from the date of disbursement of the loan.

Method of recovery of Broken Period Interest/pre-monthly instalment interest:

  • For Term Loan: Deduct from disbursement or added in first EMI, as applicable.
  • For Flexi Term Loan: Added to first instalment amount.
  • For Hybrid Flexi Loan: Added to first instalment amount.

Scenario 2: Less than period of 30 (thirty) days from the date of disbursement of the loan, interest on first instalment will be charged for actual number of days.

Note: Additional cess if any, will be applicable to all charges according to state law.

*Terms and conditions apply.

What is the personal loan interest rate?

The personal loan interest rate is the cost of borrowing money, expressed as a percentage of the loan amount. Lenders determine this rate based on various factors, including the borrower's creditworthiness, income, and the prevailing market conditions. If you meet the lender’s criteria well enough, you may be eligible for the lowest interest rate personal loan.

Interest rates for personal loans can be fixed or variable. The fixed rate remains constant throughout the loan tenure, providing predictability for monthly payments. Conversely, variable rates may fluctuate based on market changes. Typically, borrowers with higher credit scores secure lower personal loan rates. Comparing rates from different lenders is crucial to finding the most favourable terms for a personal loan, minimizing overall borrowing costs.

You can calculate the interest on personal loan with our interest calculator.

Factors affecting interest rates on personal loan

There are multiple factors that can affect your personal loan interest rate in India. It is recommended to ensure that all of the below criteria are in good health in order to avail of the loans at low-interest rates.

CIBIL Score:

A high CIBIL Score indicates a clean financial track record and helps you secure a lower interest rate.

Occupation:

Salaried and self-employed individuals may be offered different interest rates because of the nature of their income.

Income:

Higher income helps you get a low-interest rate personal loan as lenders can be assured of repayment.

Debt-to-income ratio:

Keeping this ratio low helps reduce the risk of default as you will have more funds to pay your EMIs.

Age:

Younger applicants, with many earning years remaining, may receive more affordable personal loan interest rates than those nearing retirement.

Employment:

Being employed at a renowned organisation can help you get a better personal loan interest rate in India as there is more income stability.

Relationship with the lender:

Existing customers may get a more favourable interest rate on personal loans.

Typically, here is how credit score may affect your personal loan approval:

Credit rating

CIBIL Score

Personal loan approval chances

Excellent

800+ to 900

Excellent chances for a loan with low interest rate

Good

Above 750

Likelihood of loan approval with lower interest rates.

Average

From 685 to 750

Loan may be approved, but the interest rate might be on the higher side.

Poor

Below 685

Your loan application may not be approved.


Fixed Interest Rates vs Floating Interest Rates: Which is better?

Criteria

Fixed Interest Rate

Floating/Variable Interest Rate

Definition

Interest rate remains constant throughout the loan tenure.

Interest rate changes periodically based on market conditions.

Stability

Provides stability and predictability in loan repayments.

Repayments can vary, leading to uncertainty in budgeting.

Interest Rate

Typically higher than initial floating rates to hedge against market fluctuations.

Usually starts lower but can increase over time with market changes.

Risk

Lower risk as the rate is locked in and unaffected by market volatility.

Higher risk due to potential rate hikes, but also the potential for rate decreases.

Suitable For

Borrowers preferring consistent and predictable payments, useful for budgeting.

Borrowers who can handle potential payment fluctuations and are willing to take a chance on lower rates.

Flexibility

Less flexible; prepayments or changes may incur penalties.

More flexible; often allows for early repayment with fewer or no penalties.

Market Conditions Impact

Unaffected by changes in market interest rates.

Directly impacted by market interest rate movements.


Choosing between a fixed interest rate and a floating interest rate depends on individual preferences and financial situations. If you value stability and predictability, a fixed interest rate is ideal. However, if you can handle fluctuations and want the potential benefit of lower rates, a floating interest rate may be more suitable.

How to get the lowest interest rate on a personal loan?

To secure the lowest interest rate on a personal loan, start by improving your credit score. Maintain a good credit history by paying EMIs, bills on time and reducing outstanding debts to get better terms such as a lower rate of interest on personal loans. Compare offers from multiple lenders to find low interest personal loans. Shorten the loan term to lower the total interest paid. Negotiate with lenders to see if they can offer better rates based on your financial profile. Lastly, be aware of additional fees and charges that may impact the overall cost of the loan.

If you are looking to apply for a personal loan, here are a few tips that will help you avail cheapest rate of interest:

Improve your credit score:

Having a high credit score indicates your creditworthiness, which in turn makes you eligible for the low interest loan offered by banks and financial institutions. Therefore, it's advisable to check your credit score before applying for a personal loan.

Avoid late repayments:

Missing loan or credit card repayments can negatively impact your credit score. Loan providers typically consider your repayment history when determining the fluctuating interest rate for a personal loan. Those with a history of timely payments are likely to qualify for lower interest rates.

Keep an eye for special offers:

Lenders often introduce special interest rates for a limited period, especially during festive seasons. Applying for a loan during such promotional periods may allow you to secure a lower interest rate.

Compare interest rates:

Before selecting a lender for your personal loan, it's important to compare the interest rates offered by various NBFCs. This comparison ensures that you obtain a personal loan at a competitive interest rate.

Negotiate with your lender:

If you have an established relationship with your bank or are a loyal customer, consider negotiating for better terms. It's recommended to formally request lower interest rates through a written communication with your loan provider.

How to calculate personal loan interest rate?

For instance, Priya took a personal loan of Rs. 1,00,000 at an interest rate of 15% p.a. for a tenure of 12 months. Here, Priya’s annual interest on personal loan will be around Rs. 8,310, and her monthly EMI will be around Rs. 9,026. Borrowers can use the personal loan EMI calculator to know the interest payable for multiple loan amounts by inputting principal, interest rate, and tenure.

The formula used by a personal loan EMI calculator for calculating the equated monthly instalment (EMI) for a personal loan is given by:

EMI = [PxRX(1+R)^N]/[(1+R)^N-1]​

where,

EMI is the Equated Monthly Instalment

P is the principal amount of the loan,

r is the monthly interest rate, and

n is the number of monthly instalments.

How to apply for a personal loan

Video Image 01:18
   

Step-by-step guide to apply for a personal loan

  1. Click on ‘APPLY’ at the top of this page to open our online personal loan application form.
  2. Enter your 10-digit mobile number and the OTP sent to your phone.
  3. Fill in the application form with your basic loan details, such as your full name, PAN, date of birth, and PIN code.
  4. Now, click on ‘PROCEED’ to visit the loan selection page.
  5. Enter the loan amount that you need. Choose from our three personal loan variants –Term, Flexi Term, and Flexi Hybrid.
  6. Choose the repayment tenure – you can select tenure options of 12 months to 96 months and click on ‘PROCEED’.
  7. Complete your KYC and submit your application.

Our representative will guide you on the next steps. The loan amount will be transferred to your bank account on the successful verification of your documents.

Frequently asked questions

Is there any charge applicable on part-prepayments?

Yes, there are part-prepayment charges applicable on a personal loan. However, if you have used the Flexi Loan facility, part-prepayment fees do not apply to you.

What does bounce charge mean?

You are charged with a bounce charge when you fail to make an EMI payment.

What is the maximum and minimum repayment tenure?

You can pay back your personal loan within 12 months to 96 months. That is, you can spread out your EMIs over a maximum of 8 years.

How does balance transfer help you reduce your personal loan interest?

Balance transfer may help you reduce your personal loan interest rates however it depends on the terms and offers provided by the lender.

What is the repo rate, and how does it affect personal loans?

The Reserve Bank of India (RBI) lends money to commercial banks at a repo rate. When the repo rate goes down, interest rates and EMIs for both individuals and banks tend to go down as well.
Repo rate only affects the personal loan rates if you choose a floating interest rate.

What are the charges on personal loans?

Banks and financial institutions usually have a charge to process your loan application. These charges vary according to the lender. The fees and charges for our personal loan are clearly mentioned on this page and the final loan document. We advise you to read through them thoroughly before applying.

What are the best practices to get the lowest interest rate personal loan?

Lowest-interest personal loans are the perfect solution for urgent financial needs. This will make it easier for you to make repayments. Here are a few factors that can help you find the best rate on a personal loan:

  • Maintain a good credit score
  • Compare personal loan interest rates to get the best offer
  • Look for seasonal offers
  • Qualify based on your employer’s credibility
Is 12% a good interest rate on a personal loan?

The interest rate on a personal loan varies depending on the borrower. Personal loan interest rates can be influenced by variables such as your age, credit score, monthly income, relationship with the lender, and so on. You can get a Bajaj Finance Personal Loan with competitive interest rates starting at 11%.

What is the best personal loan interest rate in India I can get?

It is recommended to compare the rates offered by different lenders to find the best personal loan interest rate in India. When applying for a personal loan, keep in mind that interest rates are not the only factor to consider. Other aspects, such as processing fees, prepayment charges, loan tenure, and repayment flexibility, should also be considered to ensure that you choose a loan that best suits your needs and financial capabilities. With Bajaj Finance Limited, you can get a personal loan with an interest rate starting at 11%.

What are the other personal loan charges a lender can levy?

Besides the interest rate, lenders often impose other loan charges on personal loans. Common ones include processing fees, bounce charges, annual maintenance charges, and mandate registration charges. It is crucial to carefully review a lender's terms to understand the full scope of potential charges before taking out a personal loan.

How are prepayment charges calculated?

The prepayment charges for the term Loan are up to 4.72% (inclusive of applicable taxes) of the principal amount of the loan prepaid on the date of such part-prepayment. Part pre-payment charges are not applicable for Flexi Term Loan (Flexi Dropline) and Flexi Hybrid.

How does my income decide my loan interest rate?

Your income plays a crucial role in determining your loan interest rate. A higher income often leads to a low-interest rate because it demonstrates your repayment capacity. Lenders use your income to assess the risk and decide on a favourable rate that aligns with your financial stability, potentially resulting in a lower interest rate.

Is it possible to secure a personal loan with a low-interest rate despite having a poor credit score?

Acquiring a personal loan with a low CIBIL Score can be challenging, as your credit score can influence your loan terms. Research extensively, and improve your creditworthiness over time to enhance your chances of securing a low-interest loan.

Can I get a low-interest personal loan without a CIBIL check?

The requirements for a personal loan differ from lender to lender. Your CIBIL Score is one of the most critical elements that can influence your loan acceptance. It is recommended that you conduct research and meet all of the other eligibility criteria set by the lender. To be eligible for a Bajaj Finance Personal Loan, you must have a CIBIL score of 685 or above.

How does employment history impact the personal loan rate of interest?

Your employment history significantly influences the interest rate of a personal loan. Stable employment demonstrates financial stability and lowers the risk for lenders, often resulting in more favourable rates. A longer and consistent work record could enhance your chances of securing a loan with lower interest.

Can the lender change the loan rate during loan tenure?

In most situations, lenders are unable to change the interest rate on personal loans during the loan term. The interest rate is normally fixed from the start of the loan, providing repayment stability. However, it's advisable to review the loan agreement to confirm if any provisions exist that allow rate changes under specific circumstances.

Which is a better option: fixed or floating interest rates?

Your risk tolerance and market forecast will influence your decision between fixed and fluctuating interest rates. Fixed rates provide stability, which is beneficial when interest rates are expected to climb. Floating rates might start low but rise over time. Consider your current financial situation as well as expected inflation patterns to determine which option is best for you in the fixed vs. floating interest rate debate.

When does the floating interest rate change?

The variable or floating interest rate fluctuates on a regular basis based on a predetermined benchmark, which is frequently connected to market conditions such as the prime rate or LIBOR. Changes are made at specified times, such as monthly, quarterly, or annually, as defined in the loan agreement, and may have an impact on the borrower’s repayment amount.

Is GST applicable on personal loan interest?

GST is not applicable on the interest portion of a personal loan but may be applicable on other aspects.

Is personal loan interest tax deductible?

Personal loan interest is not tax deductible when it is used for personal expenses.

What is the interest on a Rs. 1 lakh loan?

The interest payable on a Rs. 1 lakh loan varies depending on the loan terms. For example, the total interest payable for a Rs. 1 lakh loan, at an interest rate of 12% p.a. for a tenure of 2 years will be approximately Rs. 12,976.

What is the EMI for a Rs. 20 lakh personal loan?

The EMI for a Rs. 20 lakh personal loan depends on the interest rate and tenure. For example, at 14% interest over 5 years, the EMI would be approximately Rs. 46,565.

What is a flat personal loan interest rate?

A flat interest rate charges interest on the entire loan amount for the full loan tenure, not taking into account the decreasing principal from paid EMIs, often leading to higher overall interest costs.

What is a reducing personal loan interest rate?

A reducing interest rate (or diminishing balance rate) calculates interest on the outstanding loan balance, which decreases as each EMI is paid, resulting in lower interest payments over time.

How does my current debt level determine my interest rate?

High current debt levels increase the perceived risk for lenders, often resulting in higher interest rates due to the borrower’s higher debt-to-income ratio.

How is the processing fee calculated?

Processing fees are usually a percentage of the loan amount and are charged upfront by the lender as a one-time fee during loan disbursal.

How does balance transfer help you get a lower interest rate?

Balance transfer may help you by moving your existing loan to a new lender offering lower interest rates, thereby reducing your overall interest burden and monthly EMIs.

What are amortisation schedule charges for personal loan?

Amortisation schedule charges are fees for providing a detailed breakdown of each EMI, showing the principal and interest components.

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