Latest personal loan interest rates: Which bank offers the lowest rate?
With the Reserve Bank of India (RBI) cutting repo rates by 100 bps (1%) since the beginning of 2025, personal loan interest rates have come down. With the latest rate cut of 50 bps (0.5%) by the RBI in June, you can now avail personal loans for 9% interest. But you have to meet the specified eligibility norms to access loans at lower rates. Private sector lenders such as Axis Bank offer personal loans for 9.99% per annum.
Personal loans given by Indian Bank and Bank of Maharashtra are among the cheapest and come with an interest rate of 9%. Here is a guide on banks offering personal loans at lower interest rates and eligibility criteria.
Bank of Maharashtra
Interest rate: 9%-10.8%
Eligibility: The borrower should have a CIBIL score of 800 and above, she/he should be a confirmed employee of central government/state government/ public sector undertakings (PSUs)/ government educational institutions and should have a salary account with the bank for getting personal loan at 9% interest. If the CIBIL score is between 776 and 799, the interest rate will be 9.3%, for a score between 750 and 775 it will be 9.8%.
If the person has an account with another bank, the interest rate will be 9.8%, 10.3% and 10.8% respectively for CIBIL scores of 800 and above, 776-799 and 750-775. Confirmed employees of ‘private/public limited company’ having external rating “A” and above can get personal loans at 9.8%, 10.3% and 10.8% interest for CIBIL scores in the range cited above.
For availing the loan, the applicant should have a minimum annual income of ₹3 lakh. The applicant should provide last one-year ITR (Income Tax Return)/Form 16 from the current employer. The borrower should be between 21 years and 58 years of age. The repayment period should not exceed retirement age or 60 years of age, whichever is lower.
Processing fee: 1% of the loan amount plus GST
Indian Bank
Interest rate: 9%-9.6%
Eligibility: The bank offers low-interest personal loans for permanent employees with minimum service/ experience of two years with government/quasi-government/ boards/ endowments/ reputed companies/ corporate industrial establishments. Take home pay (after proposed EMI) should not be less than 40% of the gross salary. If salary is credited with the bank, takeover is permitted subject to compliance of norms. The minimum age is 21 years and repayment tenor will be fixed such that the loan gets closed three months prior to superannuation.
Processing fee: For government/PSU employees: Nil. For others: 1% on the loan amount; Maximum ₹10000
Axis Bank
Interest rate: 9.99%
Eligibility: Salaried employees, salaried doctors, employees of public and private limited companies, government sector employees including PSUs, central and local bodies. Minimum age of 21 years and maximum age of 60 at the time of maturity of the personal loan.
Minimum net monthly income: ₹15000 for Axis Bank customers and ₹25000 for other customers.
Processing fee: Up to 2% of loan amount plus GST
IDFC FIRST Bank
Interest rate: 9.99%
Eligibility: Salaried or self-employed, aged between 21-60 years and have a CIBIL Score of 730 and above
Processing fee:2% of the total loan amount (including GST)
State Bank of India
Interest rate: 10.3%-15.3%
Eligibility: Employees working with government sector (central government/ state government/ railway/ police/ PSU), defence sector (Defence/ Indian Coast Guard/ Central Armed Police), corporate sector
Minimum Service:
Government/ Defence Sector employees: Six months
Corporate Sector employees: 12 months
Age: 21-60 years. Loans to Government/Defence sector employees in service and more than 60 years old may be considered on a case-to-case basis.
Minimum Net Monthly Salary: Government/Defence sector employees: ₹20000. Corporate sector employees: ₹25000
HDFC Bank
Interest rate:10.9%-24%
Eligibility:
Employees of private limited companies, employees from public sector undertakings, including central, state and local bodies
Individuals between 21 and 60 years of age
Individuals who have had a job for at least two years, with a minimum of one-year with the current employer
Those who earn a minimum of ₹25000 net income per month.
Processing fee: Up to ₹6500 plus GST, stamp duty and other statutory charges will be as per actuals
ICICI Bank
Interest rate: Between 10.80% and 16.50% per annum
Eligibility: Personal Loan eligibility criteria for ‘Salaried individuals’
Age: Between 20 and 58 years
Net salary**:Minimum monthly income of ₹30000
Total work experience: Two years
**The minimum salary requirement will differ depending on the profile (type of employer, having a relationship with ICICI Bank etc.) of the customer.
Processing fee: Up to 2% of the loan amount plus applicable taxes.
IndusInd Bank
Interest rate: 12.3% onwards. Applicable government taxes, levies, etc. are over and above fees and charges.
Eligibility: Minimum age should be 21 years. Maximum age at personal loan maturity should be 60 years or retirement age whichever is earlier. Minimum net monthly income should be ₹15000. The applicant should have completed minimum two years in employment and minimum one year in the current organisation. Should have completed a minimum one year of stay at the current residence, if rented.
Processing fee: Up to 2.5% of the loan amount, Stamp duty (as per the applicant’s residence state), documentation charges (depending on the loan amount), GST and other applicable government taxes, levies.
Kotak Mahindra Bank
Interest rate: Starting from 10.99% per annum
Eligibility: Individuals aged between 21 years and 60 years are eligible. They should be employed with an MNC, public limited company, or private limited company. Applicants must possess at least one year of work experience and should be a graduate or diploma holder.
For a Kotak Mahindra Bank Salary Account holder: Minimum net monthly income of ₹25000
For a non-Kotak Mahindra Bank Salary Account holder: Minimum net monthly income of ₹30000
Processing fee: Up to 5% of the final loan amount plus taxes. This will be deducted from the loan amount at the time of disbursal.
Allirajan M is a journalist with over two decades of experience. He has worked with several leading media organisations in the country and has been writing on mutual funds for nearly 16 years.
