10 banks offering cheapest personal loan interest rates

A personal loan can come to your rescue when you are in an impasse financially and need access to money quickly. Personal loans frequently end up being a final choice for many people. Personal loans usually have higher interest rates than other types of loans since they are given without any form of security. Due to this, it is crucial to confirm the payback period provided by the bank or NBFC and interest rate also vary depending on the amount, tenure and credit score.


Here are top banks offering best rates on personal loans.

Documents required

You will need to furnish only the following documents along-with Loan Application Form:

• Latest passport size photographs – 2
• Copy of identity card issued by the employer
• Bank account
• Last 6 months’ salary slip or latest Form 16 (in case of Income Tax Payee)

(a) Permanent Account Number (PAN).
(b) At least one copy of the Officially Valid Documents (OVDs) mentioned below, as proof of identity and current address:
i. Passport
ii. Driving license
iii. Proof of possession of Aadhaar Number
iv. Voter's Identity Card issued by Election Commission of India
v. Job card issued by NREGA duly signed by an officer of the State Government
v. Job card issued by NREGA duly signed by an officer of the State Government
vi. Letter issued by the National Population Register containing details of name and addr

Is it mandatory to buy an insurance policy with a Personal Loan?
According to the Union Bank of India, “This is optional and purely at the discretion of the Borrower. However it is always advisable to get a liability/life insurance cover so that family members don’t suffer in case of any unfortunate event. For the benefit of the borrowers, one time Liability Insurance premium can be added in the cost of the property so that the burden can be reduced. Further, Bank also has tied-up with various Insurance Providers so that suitable products can be available to its customers with reasonable premium. “

Repayment of personal loan
Repayment tenure and penalty may differ depending on the bank. According to the SBI website, any prepayment of EMIs in full or in part and closure of account before the end of term will attract the prepayment charges of 3% on prepaid amount. No prepayment/ foreclosure charges will be applicable if the account is closed from the proceeds of a new loan account opened under the same scheme.

What is the processing fee?
Yes, banks do charge processing fee and other charges before personal loan is processed amount also vary with bank. SBI, for example, charges a processing fee of 1% of the loan amount plus applicable GST. It should be noted that the applicant will also be responsible for the real stamp duty charges incurred under the State Stamp Act. There are no additional fees. The applicant will also be responsible for the actual stamp duty charges incurred under the State Stamp Act. There are no additional fees.