Top 10 Best Private Banks in India List 2024
April 30, 2024
India, with its robust banking system and evolving digital landscape, has witnessed an upsurge in the demand for personal loans over the past decade. Personal loans, often touted as the go-to financial solution for immediate needs, can be a lifesaver when addressing unplanned emergencies, home renovations, higher education, or even dream vacations. Choosing the right bank for your personal loan is akin to selecting the right partner for a journey – it can either make your financial voyage smooth and hassle-free or replete with obstacles.
Banks in India, both in the private and public sectors, have rigorously tailored their personal loan products to meet the diverse needs of the Indian populace. From competitive interest rates and flexible repayment options to minimal documentation and speedy disbursal, banks are vying for the attention of potential borrowers. But with a plethora of options available, how does one determine which bank offers the best personal loan that aligns with one’s needs?
Want to know which bank is best for personal loan? In this comprehensive guide, we will delve deep into the intricacies of India’s banking landscape and present you with an insightful analysis of the best banks for getting personal loans. Here’s the personal loan bank list.
List of 10 Personal Loan Banks List in India 2024
| Banks | Headquarters | Interest Rates | No. of Branches | Loan Processing Fee |
| SBI Personal Loan | Mumbai | 9.60% – 15.30% p.a. | 28,800+ | 1% of the loan amount + applicable tax |
| ICICI Bank Personal Loan | Mumbai | 10.50% to 18.49% p.a. | 6,070+ | Up to 2.25% p.a. of loan amount + GST |
| HDFC Bank Personal Loan | Mumbai | From 10.50% to 21.50% p.a. | 8,300+ | Up to 2.5% of the loan amount with a minimum of Rs. 1,999 |
| Kotak Mahindra Bank Personal Loan | Mumbai | From 10.50% – 20.99% | 2,000+ | Up to 2.5% of the loan amount + GST and other applicable statutory levies |
| Axis Bank Personal Loan | Mumbai | From 12% – 24% p.a. | 5700+ | 1.5% to 2% + GST as applicable |
| Citibank Personal Loan | Mumbai | From 9.99% to 18.99% p.a. | 35+ | Up to 3% |
| Bajaj Finserv Personal Loan | Pune | From 13% to 16% p.a | 1,600+ | 2.25% to 3% |
| Bank of Baroda Personal Loan | Vadodara | From 10.50% to 16.60% p.a. | 9600+ | 2% |
| Tata Capital Personal Loan | Mumbai | From 11.49% to 19% p.a | 250+ | 2% |
| Standard Chartered Personal Loan | Mumbai | From 11.25% to 19% p.a. | 105+ | 1% |
1) State Bank of India
When it comes to availing personal loans, people often ponder over the question, which bank is best for personal loan? SBI comes across as a viable option. It provides personal loan options for both salaried individuals and self-employed professionals. They have three distinct personal loan products: Xpress Credit Loan, SBI Pension Loan, and SBI Saral Personal Loan.
Reasons to consider a personal loan from SBI:
- The application process is streamlined and digital.
- They present attractive interest rates.
- Their policies are transparent, ensuring no concealed charges.
- Loan disbursement time is generally between 3-10 days
| Loan amount | Up to Rs. 15 lacs |
| Applicant’s age | 21 – 60 years |
| Interest rate | 9.60% – 15.30% p.a. |
| Processing fee | 1% of the loan amount + applicable tax |
| Minimum income requirement | Rs. 5000 per month |
| Loan tenure | Maximum 60 months or residual service period, whichever is less |
2) ICICI Bank
ICICI Bank offers compelling interest rates for personal loans, starting at just 10.99% annually. The interest is calculated based on the remaining monthly loan amount using the reducing balance method. It is one of the most trustworthy banks on the personal loan bank list.
Reasons to consider a personal loan with ICICI Bank:
- ICICI stands by its principles of transparent dealings.
- Avail loans at a competitive rate of 10.99%.
- Enjoy a straightforward and rapid loan process.
- Loan disbursement time can range from 1-2 working days.
| Interest rate | 10.50% to 18.49% p.a. |
| Applicant’s Age | For salaried: 23 to 58 years; self-employed: 25 to 65 years |
| Loan amount | Up to 20 Lacs |
| Processing fee | Up to 2.25% p.a. of loan amount + GST |
| Prepayment charge | 5% p.a. of principal outstanding + GST |
| Loan tenure | From 12 to 60 months |
3) HDFC Bank
HDFC, a top-tier private bank, offers diverse banking services at attractive interest rates. For self-employed individuals, there’s an option to secure a personal loan up to Rs. 15 lacs without the need for a guarantor or collateral. If you research the personal loan bank list, HDFC will come out as one of the top 5 banks to get personal loans from.
Reasons to contemplate a personal loan from HDFC Bank:
- Transparent costs, minimal processing fees, and an easy repayment system.
- Reduced requirement for documentation.
- Exclusive offers available for high-ranking corporate workers.
- Loan disbursement time is usually 1 day.
| Interest rate | From 10.50% to 21.50% p.a. |
| Applicant’s Age | From 21 to 60 years |
| Minimum income requirement | Rs. 15,000 per month |
| Processing fee | Up to 2.5% of the loan amount with a minimum of Rs. 1,999 |
| Loan amount | Up to Rs. 15 Lacs |
| Loan tenure | From 12 months to 60 months |
4) Kotak Mahindra Bank
You often think about getting a personal loan for yourself but cannot decide which bank is best for personal loans? Kotak Mahindra Bank is a great option and extends personal loan offerings to both salaried professionals and self-employed individuals. Consider turning to Kotak Bank’s personal loans for immediate requirements, such as unexpected medical expenses. Owing to so many features, Kotak Mahindra Bank will come in the top 5 of the personal loan bank list.
Reasons to consider a Kotak Mahindra Personal Loan:
- Loan amounts range from 50,000 to 15,00,000 rupees.
- Swift and straightforward approval process.
- Opportunity to consolidate an existing personal loan through Kotak Mahindra Bank.
- There’s no need for collateral or guarantees.
- Highlighted features of the Kotak Mahindra Personal Loan are outlined below.
- Loan disbursement time is usually between 1-3 days (offline) and 1 day for online loans.
| Interest rate | From 10.50% – 20.99% |
| Applicant’s Age | From 21 to 58 years |
| Loan amount | Up to Rs. 15 Lacs |
| Loan processing charge | Up to 2.5% of the loan amount + GST and other applicable statutory levies |
| Prepayment charge | Lock-in period for 12 months. After 12 months, 5% foreclosure charge + GST on the principal outstanding |
| Loan tenure | Up to 60 months |
5) Axis Bank
Axis Bank delivers remarkable attributes and perks with its loan services, encompassing adaptable repayment options, modest processing charges, and attractive interest rates. With this, it won’t be an understatement to say that Axis Bank is one of the best choices for personal loans.
Reasons to consider a personal loan from Axis Bank:
- A reputable name in the banking sector.
- Quick sanctioning with minimal documentation.
- Zero charges on early loan closure.
| Interest rate | From 12% – 24% p.a. |
| Processing charge | 1.5% to 2% + GST as applicable |
| Prepayment/foreclosure charge | Nil |
| Applicant’s Age | 21 – 60 years |
| Income requirement | Rs. 15,000 |
| Loan amount | Rs. 50,000 to 15 Lacs |
| Loan tenure | Up to 60 months |
6) Citibank
Citibank extends personal loan offers primarily to salaried individuals, presenting them with more favourable interest rates compared to self-employed individuals.
Reasons to contemplate a personal loan from Citibank:
- Exclusive promotions and deals.
- Citibank requires only limited paperwork from customers.
- Options are available for both complete and partial advance payments.
- A consistent interest rate guarantees steady monthly installments.
| Interest rate | From 9.99% to 18.99% p.a. |
| Loan amount | Up to Rs. 30 Lacs |
| Processing fee | Up to 3% |
| Late fee | 24% p.a. |
| Pre-closure charge | 4% |
| Loan tenure | 1 to 5 years |
| Up to 60 months |
7) Bajaj Finserv
As a prominent NBFC, Bajaj Finserv presents a diverse range of financial products. Their personal loans come with appealing interest rates to cater to diverse personal requirements.
Reasons to consider a personal loan from Bajaj Finserv:
- Adaptable payback conditions.
- Rapid disbursement in less than 48 hours.
- The entire loan application journey is digital.
- No charges for partial pre-settlement.
| Interest rate | From 13% to 16% p.a |
| Processing fees | 2.25% to 3% |
| Applicant’s Age | 25-58 years |
| Minimum income requirement | Rs 30,000 |
| Loan amount | Up to Rs. 25 Lacs |
| Loan tenure | 12 to 60 months |
8) Bank of Baroda
Thinking hard about which bank is the best for personal loans? Your search may end with Bank of Baroda. Bank of Baroda offers personal loans to both salaried professionals and those who are self-employed. Depending on qualifications, the loan sum can go up to Rs. 10 lacs.
Reasons to consider a personal loan from Bank of Baroda:
- After six monthly installments, there’s no charge for early loan closure.
- Perfect for those eyeing a personal loan of less than Rs. 20,000.
- Minimal administrative fees.
| Interest rate | From 10.50% to 16.60% p.a. |
| Processing fee | 2% |
| Pre-closure Charges | 6% in case within 6 months, after 6 months no charges |
| Loan tenure | 4 years |
| Loan amount | Up to 10 lacs |
9) Tata Capital
Tata Capital’s personal loan comes with a host of benefits, such as straightforward document procedures, the absence of security needs, and freedom in its application.
Following are the reasons to consider securing a personal loan from Tata Capital:
- Limited document formalities.
- A versatile loan tenure ranging from 12 to 84 months.
- Reduced administrative fees.
- Loan amounts can vary from 75,000 to 25,000 rupees.
| Interest rate | From 11.25% to 19% p.a. |
| Applicant’s Age limit | From 25 years to 65 years |
| Loan amount | Up to 25 Lacs |
| Processing fee | 2% |
| Pre-closure charge | Up to 4% |
| Loan tenure | 12 months to 84-month |
10) Standard Chartered
Standard Chartered stands as a leading digital financier for personal loans in India. They cater to a myriad of financial needs, be it travel, a child’s marriage, home upgrades, advanced education, and more.
Reasons to ponder over a personal loan from Standard Chartered:
- Competitive interest rates beginning at 10.99%.
- Adaptable repayment options.
- Convenient and user-friendly online process.
- No need for collateral, guarantees, or third-party assurances.
| Applicant’s Age limit | From 23 to 58 years |
| Interest rates | From 11.49% to 19% p.a |
| Loan amount | Up to 30 lacs |
| Processing fee | 1% |
| Pre-closure Charges | Nil |
| Loan tenure | From 12 to 60 months |
Pros and Cons of Personal Loans
Following are the pros of getting a personal loan:
Single Disbursement
Receiving the entire loan amount upfront makes it convenient for activities like significant acquisitions or amalgamating debts. The fixed interest rate and consistent monthly installments further simplify its management.
Quick Accessibility
One notable merit of personal loans is the swift approval and disbursement, making them ideal for urgent financial needs. Some lenders can even transfer the amount to your account within a day.
Absence of Collateral
Most personal loans are unsecured, meaning you won’t need to pledge assets like a home or car as security. While defaulting will have adverse financial and credit implications, the risk of asset forfeiture, as seen in secured loans, isn’t present.
Competitive Interest Rates
Typically, the interest rates for personal loans are more favourable than those on credit cards. For instance, as of July 2022, the average rate hovered around 10.28%. Individuals with stellar credit scores might even secure rates between 10.3% and 12.5%. Plus, potential loan amounts might surpass credit card limits. If you find yourself a bit confused then the aforementioned list will help you find which is the best bank for personal loans.
Flexible Duration
Unlike high-interest short-term solutions like payday loans, personal loans can have durations ranging from two to ten years, depending on the lender. This offers borrowers manageable installments and ample time for repayment.
Streamlined Management
Many opt for personal loans to consolidate diverse credit card debts. Managing a single personal loan, with its fixed monthly payment, becomes more straightforward than juggling various credit cards with fluctuating interest rates and varying due dates.
Cons
Following are the cons of getting a personal loan.
Potentially High-Interest Rates
Not all personal loans come with favourable interest rates. This is especially true for individuals with compromised credit histories. Such borrowers might find themselves facing rates that are even steeper than those on certain credit cards or asset-backed loans. Wondering which bank is best for personal loan on the basis of interest rates? The aforementioned personal loan bank list will help you.
Criteria Challenges
Getting approval for a personal loan might be tougher compared to other financing avenues. If your credit history is short or less than stellar, you might find fewer lenders eager to accommodate you. Moreover, some might not entertain the idea of co-signers, which could otherwise bolster approval odds for those with limited credit profiles.
Added Costs and Restrictions
There could be various costs associated with personal loans that can elevate the borrowing expense. Some might come with origination fees, which could range between 1 to 6% of the loan’s principal. These fees can either be tacked onto the loan or deducted upfront. Furthermore, paying off your loan earlier than scheduled might incur prepayment penalties with some lenders. It’s crucial to be aware of all attached fees and terms beforehand.
Another Repayment Obligation
Securing a personal loan means committing to an additional monthly outlay. If not planned for, this new financial commitment could strain your budget, potentially leading to financial imbalances in the long run.
Amplified Indebtedness
While personal loans can serve as a means to consolidate other debts, they don’t necessarily address the root causes of said debts. If you clear credit card balances with a personal loan, your credit utilisation drops, thereby increasing your available credit. This might tempt some to accrue more charges rather than chip away at their overall debt.
Tips to Choose the Best Personal Loan Bank
Here are the top tips for choosing the best personal loan:
- Before diving into the sea of personal loan options, first identify why you need the loan. Whether it’s for home renovations, medical emergencies, or consolidating debt, pinpointing your objective will help narrow down suitable loan offers. Additionally, understand your monthly budget to determine a comfortable repayment amount.
- The interest rate is a pivotal factor in determining the total cost of your loan. While a lower rate can save you money, be wary of teaser rates that are low initially and then rise. Always consider the Annual Percentage Rate (APR), which includes both the interest rate and any associated fees.
- Beyond the interest rate, be alert to any additional fees, like origination fees, late fees, or prepayment penalties. Some lenders might offer a slightly higher interest rate but lower fees, which, over the term of the loan, might be more beneficial.
- Some lenders offer flexibility in repayment options, like allowing occasional deferred payments or offering a grace period. Others might have features like direct payments to creditors for debt consolidation loans or multi-year terms. Choose a loan that aligns with both your needs and your financial situation.
- Last but certainly not least, research the lender’s reputation. Read reviews, check with regulatory bodies for any complaints, and ask friends or family for their experiences. A reputable lender will provide not only a good loan product but also quality customer service throughout the loan’s duration.
Conclusion
Selecting an ideal bank for a personal loan in India demands careful deliberation. Given the multitude of choices, each presenting distinct advantages, it’s vital to match your fiscal aspirations with what the bank provides. A comprehensive investigation, complemented by advice from a financial expert, can guide you towards a judicious decision, guaranteeing a hassle-free and advantageous loan journey. It’s crucial to recognise that the top bank doesn’t solely revolve around attractive interest rates, but also hinges on reliability, service excellence, and the entirety of the lending experience.
FAQs
Which bank is best for personal loans in India?
While the optimal choice for personal loans is subjective and hinges on individual requirements, eminent institutions like HDFC, SBI, ICICI, and Axis Bank often come highly recommended due to their appealing interest rates, adaptable conditions, and expansive outreach. One should evaluate options, scrutinise feedback, and understand the stipulations before finalising.
How is the flat interest rate for a personal loan defined?
A flat interest rate implies that the interest is computed on the total original principal amount, irrespective of the progressive monthly reductions in the outstanding balance. This contrasts with diminishing balance interest rates, where the interest is based on the residual loan amount. For instance, if a loan of Rs. 100,000 is availed at a flat interest rate of 10% annually for 3 years, the yearly interest remains Rs. 10,000, independent of repayments.
Which financial institution has a straightforward process for personal loans?
Securing a personal loan predominantly rests on one's creditworthiness, paperwork, and economic track record. That said, NBFCs (Non-Banking Financial Companies) like Bajaj Finserv and Tata Capital may exhibit more relaxed standards compared to orthodox banks. Among banks, institutions like HDFC and ICICI are renowned for their efficient methodologies, though this can fluctuate based on individual cases.
Which public-sector bank stands out for personal loans?
Considering public-sector banks in India, the State Bank of India (SBI) frequently emerges as a preferred selection for personal loans, attributed to its transparent conditions, lucrative interest rates, and extensive branch infrastructure. Other public banks, including Bank of Baroda and Punjab National Bank, are also in the running.
Are there genuinely zero-interest loans available?
In the strictest sense, no loan is devoid of interest since lending entities aim to earn. Nonetheless, certain organisations, predominantly in the realms of microfinance or community-driven financing, may present interest-free loans as societal welfare endeavours. Moreover, select promotional campaigns linked to credit cards or commercial purchases might herald zero-interest deals. It's imperative to meticulously go through the associated terms, as hidden fees or other charges might be lurking.
