As banks are raising their interest rates after the Reserve Bank of India (RBI) raised its key repo rate, loans are also becoming costlier as several lenders have already revised their interest rates over the past weeks. Here is a comparison of interest rates on personal loans from five banks – Punjab National Bank, State Bank of India, Bank of Baroda, Bank of Maharashtra and Union Bank of India:
Punjab National Bank is currently offering personal loans at an interest rate of 8.80-15.35 per cent per annum. Roughly speaking, on a loan of Rs 5 lakh, the equated-monthly installment (EMI) for a period of five years would be Rs 10,331-11,987. In addition, processing fees (as a percentage of the total loan amount) are also charged. PNB charges a processing fee of up to 1%.
The interest rate offered varies from person to person based on gender, age and credit score, among other factors.
State Bank of India is now providing personal loan at an interest rate of 9.80-13.80 percent. Accordingly, the EMI for five years on a loan of Rs 5 lakh would be Rs 10,574-11,582. In addition, a processing fee (as a percentage of the total loan amount) is also charged. SBI charges a processing fee of 1.5 per cent or up to Rs 15,000, whichever is lower.
Meanwhile, Bank of Baroda’s interest rate on personal loans ranges from 9.20-16.55 per cent per annum. If you take a personal loan of Rs 5 lakh, your EMI will be around Rs 10,428-12,306 per month depending on the interest rate offered to you. Apart from this, processing fees up to 2% of the total loan will have to be paid, with a minimum fee of Rs 1,000 and a maximum of Rs 10,000.
Bank of Maharashtra offers interest rates between 9.35 per cent and 13.70 per cent on personal loans. The EMI on a personal loan of Rs 5 lakh for five years will be around Rs 10,464-11,557. In addition, a processing fee (as a percentage of the total loan amount) is also charged. Bank of Maharashtra charges a processing fee of up to 1% on the loan.
Among all these five banks, the highest interest is charged by Union Bank of India. It charges interest in the range of 9.8-13.9 per cent per annum on personal loans. On a loan of Rs 5 lakh, an EMI of Rs 10,574-11,608 will have to be paid for five years.
Several lenders including ICICI Bank, Kotak Mahindra Bank, HDFC Bank and Punjab National Bank have recently increased their interest rates for both deposits and loans. RBI’s Monetary Policy Committee recently unanimously decided to increase the repo rate by 50 basis points to 4.90 per cent with a focus on housing clearance. This has prompted lenders to increase interest rates on loans. According to the latest official data, retail inflation came down slightly to 7.04 per cent in May.
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