Recently, the Reserve Bank of India (RBI) increased the risk weights by 25 percentage points to 125 percent for consumer credit exposure, especially for personal loans. As a result, banks must now maintain larger capital reserves, which raises the cost of capital for these loans. This adjustment affects both new and existing loans.
Consequently, while banks modify their lending practices to comply with the new capital requirements, borrowers may face higher interest rates and restricted access to credit.
The banks on this list have the lowest interest rates on personal loans, making it possible for people to get money at reasonable prices.
Name of Banks/NBFCs | Interest Rates (p.a.) |
Navi Finserv | 9.90% – 45.00% |
HSBC | 9.99% – 16.00% |
Faircent | 9.99% onwards |
Bank of Maharashtra | 10.00% – 12.80% |
Bank of India | 10.25% – 14.75% |
Punjab National Bank | 10.40% – 16.95% |
Axis Bank | 10.49% onwards |
IndusInd Bank | 10.49% onwards |
IDFC First Bank | 10.49% onwards |
ICICI Bank | 10.50% onwards |
HDFC Bank | 10.50% onwards |
State Bank of India | 10.55% – 14.55% |
Additionally, by February 29, 2024, all entities subject to regulation must comply with the new guidelines, as announced by the Reserve Bank of India.
Interest rates on personal loans vary depending on a number of variables, including credit score and bank preference. It is essential to compare the most recent interest rates and processing fees provided by several respectable banks before applying for a personal loan.