Best Personal Loans 2019

Personal loans are very helpful for individuals that need cash for urgent expenses. In this guide, we feature the best personal loans available in India and make recommendations based on our thorough analysis in order to help you compare rates and features. Use our guide below to find the best personal loan for your financing needs.

Best for:LoanBest for:Loan
Salaried IndividualsCitibank Personal LoanShort-Term Personal LoansIDFC Simple Personal Loan
Long-Term Personal LoansIOB Royal Personal LoanLarge Personal LoansHDFC Personal Loan
Low-Income EarnersIOB Personal LoanHonorable MentionUCO Bank & Union Bank

Our Top Picks for the Best Personal Loans in India

The following list represents our picks for the best available personal loans in India. In order to compare and analyse these loans, we considered factors including interest rates, processing fees and various features that would make these products relevant to a variety borrowers. As you begin to compare these personal loans, we strongly suggest that you look for loans that minimise the total cost of borrowing while also allowing you to comfortably make monthly repayments in a timely manner.

Estimated Cost of 3-Year, Rs. 2 Lakh Personal Loan by Bank: Chart ranks banks by estimated total cost of borrowing, based on the lowest interest rates advertised to salaried loan applicants. Estimates include processing fees.

Best Personal Loan for Salaried Individuals: Citibank Personal Loan

Consider this if are a salaried employee and seek a competitively priced loan

Required Monthly Income Unknown
Min. Loan Amount Rs. 25,000
Max. Loan Amount Rs. 30 lakh
Processing Fee 0.25% - 2%
Interest Rate Type Fixed
Loan Tenure 12 to 60 months

Citibank's Personal Loan is one of the cheapest options available in India. For instance, the bank charges fixed annual interest rates of 10.99% to 14.25% to salaried borrowers and 16.49% to 18.99% to self-employed borrowers, while its competitors tend to charge about 13% to 20% on average. While these differences may not appear to be dramatic, Citibank's personal loans may actually save eligible borrowers hundreds of rupees per month and tens of thousands of rupees over the course of their loan. Furthermore, Citibank's cheaper rates are lower than many floating rates available in India (typically about 12% - 14%), which gives borrowers that are eligible the chance to lock in very low interest rates. The bank also charges processing fees of 0.25% to 2% for salaried borrowers, which are lower than the average fees charged by personal lenders in India.

It is important to note that most lenders in India, including Citibank, advertise interest rates in ranges (e.g. 11% to 15%), rather than guaranteeing that all customers will receive specific rates. For this reason, it is imperative to compare each bank's interest rates and even negotiate your rate with bank representatives to ensure that you are getting the cheapest personal loan given your circumstances.

Read our full review

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
10.25%11.24%Rs. 88,494Rs. 64,424
20.25%11.24%Rs. 46,719Rs. 1,23,764
30.25%11.24%Rs. 32,853Rs. 1,85,190
40.25%11.24%Rs. 25,962Rs. 2,48,687
50.25%11.24%Rs. 21,862Rs. 3,14,238
*Assuming borrower with net monthly salary of Rs. 75,000, loan of Rs. 10 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
10.25%11.24%Rs. 88,494Rs. 64,424
20.25%11.24%Rs. 46,719Rs. 1,23,764
30.25%11.24%Rs. 32,853Rs. 1,85,190
40.25%11.24%Rs. 25,962Rs. 2,48,687
50.25%11.24%Rs. 21,862Rs. 3,14,238
*Assuming borrower with net monthly salary of Rs. 75,000, loan of Rs. 10 lakh, total cost includes processing fee

Best Short-Term Personal Loan: IDFC Simple Personal Loan

Consider this if you prefer a short-term loan

Required Monthly Income Rs. 20,000
Min. Loan Amount Rs. 50,000
Max. Loan Amount Rs. 20 lakh
Processing Fee 2%
Interest Rate Type Fixed
Loan Tenure 3 to 60 months

IDFC's Simple Personal Loan is a great option for individuals that seek short-term personal financing. This is because the bank offers offers the shortest advertised personal loan tenures in India of 3 months. By shortening the duration of your loan, you will be able to reduce the total interest accrued and effectively make your loan less expensive. However, it is important to understand that, while loans with shorter tenures may cost less in terms of total interest cost, they also typically require larger monthly payments. Additionally, IDFC offers a wide range of interest rates from as low as 12% to as high as 20%, which makes it difficult to know if you'll be eligible for a competitively priced loan. Finally, if you are interested in loans of at least 1 year, you may be able to find more competitive rates from other lenders in India.

Read our full review

Duration (Months)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
32%12%Rs. 34,002Rs. 4,067
32%20%Rs. 34,451Rs. 5,352
62%12%Rs. 17,255Rs. 5,529
62%20%Rs. 17,652Rs. 7,914
* Assuming loan of Rs. 1 lakh, total cost includes processing fee
Duration (Months)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
32%12%Rs. 34,002Rs. 4,067
32%20%Rs. 34,451Rs. 5,352
62%12%Rs. 17,255Rs. 5,529
62%20%Rs. 17,652Rs. 7,914
* Assuming loan of Rs. 1 lakh, total cost includes processing fee

Best Long-Term Personal Loan: IOB Royal

Consider this if need a loan with a duration of more than 5 years

Required Monthly Income Rs. 75,000
Min. Loan Amount Unknown
Max. Loan Amount Rs. 15 lakh
Processing Fee 1.01% - 1.1%
Interest Rate Type Floating
Loan Tenure 12 to 84 months

IOB Royal is a great option for individuals that need a personal loan with a very long tenure. The bank offers this loan with tenures of up to 7 years (84 months), which is much longer than other personal loans offered in India that typically offer maximum loan tenures of 3 to 6 years. Longer-term loans typically require smaller monthly payments by spreading the repayment of the loan principal out over a longer period of time. This can be helpful for borrowers that are on a tight budget.

However, it is important mention that IOB Royal has a high gross monthly income requirement of Rs. 75,000, which prevents many prospective borrowers from being eligible for this loan. Additionally, borrowers with incomes that meet this requirement will likely be able to obtain cheaper interest rates for shorter loans from other lenders. Therefore, IOB royal is particularly attractive to high-income earners seeking a very long-term loan.

Read our full review

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11.01%12.95%Rs. 89,294Rs. 81,626
21.01%12.95%Rs. 47,518Rs. 1,50,540
31.01%12.95%Rs. 33,670Rs. 2,22,216
41.01%13.40%Rs. 27,176Rs. 3,15,459
51.01%13.40%Rs. 23,113Rs. 3,97,781
61.01%13.40%Rs. 20,445Rs. 4,83,072
71.01%13.40%Rs. 18,575Rs. 5,71,273
*Assuming borrower with net monthly salary of Rs. 75,000, loan of Rs. 10 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11.01%12.95%Rs. 89,294Rs. 81,626
21.01%12.95%Rs. 47,518Rs. 1,50,540
31.01%12.95%Rs. 33,670Rs. 2,22,216
41.01%13.40%Rs. 27,176Rs. 3,15,459
51.01%13.40%Rs. 23,113Rs. 3,97,781
61.01%13.40%Rs. 20,445Rs. 4,83,072
71.01%13.40%Rs. 18,575Rs. 5,71,273
*Assuming borrower with net monthly salary of Rs. 75,000, loan of Rs. 10 lakh, total cost includes processing fee

Largest Personal Loan: HDFC Personal Loan

Consider this if you require a very large personal loan

Required Monthly Income Rs. 15,000 NMI (Rs. 20,000 in Mumbai, Delhi, Bengaluru, Chennai, Hyderabad, Pune, Kolkata, Ahmedabad, Cochin)
Min. Loan Amount Rs. 50,000
Max. Loan Amount Rs. 40 lakh
Processing Fee 2.5%
Interest Rate Type Fixed
Loan Tenure 12 to 60 months

HDFC's personal loans are a great option for prospective borrowers that need large loans of more than Rs. 30 lakh. This is because HDFC offers the largest personal loans in India, with loans as large as Rs. 40 lakh. In comparison, the bank's competitors typically offer loans as large as Rs. 20 lakh to Rs. 30 lakh. For this reason, prospective borrowers that require a large sum of money may prefer HDFC compared to other lenders in India. However, prospective borrowers that are interested in loans of Rs. 30 lakh or less are likely to obtain much lower rates from banks other than HDFC, given the bank's higher than average advertised interest rates that range from 15.5% to 21.5%.

Read our full review

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
12.5%15.5%Rs. 361,978Rs. 443,732
22.5%15.5%Rs. 194,898Rs. 7,77,556
32.5%15.5%Rs. 139,643Rs. 11,27,138
42.5%15.5%Rs. 112,339Rs. 14,92,293
52.5%15.5%Rs. 96,213Rs. 18,72,766
*Assuming loan of Rs. 40 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
12.5%15.5%Rs. 361,978Rs. 443,732
22.5%15.5%Rs. 194,898Rs. 7,77,556
32.5%15.5%Rs. 139,643Rs. 11,27,138
42.5%15.5%Rs. 112,339Rs. 14,92,293
52.5%15.5%Rs. 96,213Rs. 18,72,766
*Assuming loan of Rs. 40 lakh, total cost includes processing fee

Best Personal Loan for Low-Income Earners: IOB Personal Loan

Consider this if you earn less than Rs. 10,000

Required Monthly Income Rs. 5,000, Rs. 75,000
Min. Loan Amount Unknown
Max. Loan Amount Rs. 5 lakh, Rs. 15 lakh
Processing Fee 1.01% - 1.1%
Interest Rate Type Floating
Loan Tenure 12 to 60/84 months

The Indian Overseas Bank's (IOB) personal loan is a great choice for individuals that earn modest incomes. This is due to its very low monthly income requirement of Rs. 5,000 and lower than average floating interest rate of 11.95%. It is an even better option for low-income women because the bank offers interest rates of 11.45% to female borrowers. Furthermore, borrowers can obtain even lower interest rates by providing 100% collateral security. The bank also charges lower processing fees (1.01% - 1.1%) than the market average. Unfortunately, IOB's personal loan does not offer very large loan quantums compared to other banks; its maximum loan size is 5 lakh. Still, low-income borrowers can find affordable rates for smaller loans through IOB.

Read our full review

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11.01%11.95%Rs. 4,441Rs. 3,845
21.01%11.95%Rs. 2,353Rs. 7,010
31.01%11.95%Rs. 1,660Rs. 10,293
41.01%11.95%Rs. 1,316Rs. 13,692
51.01%11.95%Rs. 1,111Rs. 17,208
*Assuming monthly income of Rs. 5,000, loan of Rs. 50,000 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11.01%11.95%Rs. 4,441Rs. 3,845
21.01%11.95%Rs. 2,353Rs. 7,010
31.01%11.95%Rs. 1,660Rs. 10,293
41.01%11.95%Rs. 1,316Rs. 13,692
51.01%11.95%Rs. 1,111Rs. 17,208
*Assuming monthly income of Rs. 5,000, loan of Rs. 50,000 lakh, total cost includes processing fee

Honorable Mention: UCO Bank & Union Bank

While we believe that the list of lenders above represents the best borrowing options for most individuals, it is also important to be aware of offerings that are available to existing bank customers. For example, the two lenders below offer particularly competitive personal loan products to their existing customers.

Best Small Personal Loan: UCO Bank Shopper Loan

Consider this if need a small loan and are a current UCO Bank customer

Required Monthly Income Rs. 10,000
Min. Loan Amount Unknown
Max. Loan Amount Up to Rs. 2 lakh
Processing Fee 1% (minimum Rs. 1,000)
Interest Rate Type Floating
Loan Tenure Up to 60 months

The UCO Bank Shopper Loan is a great option for those who have been customers of the bank for at least 6 months. This is because this loan has the lowest advertised interest rate of any of the loans in our review at 9.8% to 10.8%, as well as a very low processing fee of just 1%. It is specifically appealing to borrowers who only need to borrow a small amount, as it only offers loan quantums of up to Rs. 2 lakh. Unfortunately, prospective borrowers that are interested in the Bank Shopper Loan but are not UCO customers will have to wait at least 6 months in order to become eligible, which may be too long for those that need funds quickly.

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11%9.8%Rs. 17,565Rs. 12,775
21%9.8%Rs. 9,211Rs. 23,053
31%9.8%Rs. 6,435Rs. 33,648
41%9.8%Rs. 5,053Rs. 44,560
51%9.8%Rs. 4,230Rs. 55,785
*Assuming loan of Rs. 2 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
11%9.8%Rs. 17,565Rs. 12,775
21%9.8%Rs. 9,211Rs. 23,053
31%9.8%Rs. 6,435Rs. 33,648
41%9.8%Rs. 5,053Rs. 44,560
51%9.8%Rs. 4,230Rs. 55,785
*Assuming loan of Rs. 2 lakh, total cost includes processing fee

Best Personal Loan for Self-Employed Individuals: Union Personal Loan

Consider this if you are self-employed and a current Union Bank customer

Required Monthly Income N/A
Min. Loan Amount Unknown
Max. Loan Amount Up to Rs. 10 lakh
Processing Fee 0.50%, minimum Rs. 500 + GST
Interest Rate Type Floating
Loan Tenure Up to 60 months

Union Bank's Union Personal Loan is a great option for individuals that are not salaried employees. While it charges a relatively high interest rate of 14.5%, the bank's personal loan for non-salaried borrowers is a good option for these individuals as it does not have a minimum income requirement, unlike its competitors. However, to be eligible for Union Bank's personal loan, non-salaried applicants must be customers of Union Bank, having a banking history of 2 years with the bank and an average quarterly balance of at least Rs. 25,000.

Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
10.5%14.5%Rs. 17,565Rs. 12,775
20.5%14.5%Rs. 9,211Rs. 23,053
30.5%14.5%Rs. 6,435Rs. 33,648
40.5%14.5%Rs. 5,053Rs. 44,560
50.5%14.5%Rs. 4,230Rs. 55,785
*Assuming loan of Rs. 2 lakh, total cost includes processing fee
Duration (Years)Processing FeeEffective Interest RateMonthly PaymentTotal Cost
10.5%14.5%Rs. 17,565Rs. 12,775
20.5%14.5%Rs. 9,211Rs. 23,053
30.5%14.5%Rs. 6,435Rs. 33,648
40.5%14.5%Rs. 5,053Rs. 44,560
50.5%14.5%Rs. 4,230Rs. 55,785
*Assuming loan of Rs. 2 lakh, total cost includes processing fee

How to Choose a Personal Loan

If you need financing quickly for an unexpected expense you may be interested in finding a personal loan. Before you apply, it is important to compare the options that are available to you. First, you should make sure a personal loan is the best type of debt for your situation. For example, while personal loans tend to charge lower interest rates than credit cards, they are typically more expensive compared to home loans, student loans or vehicle loans.

Once you've settled on applying for a personal loan, it is helpful to compare loans based on your financing needs. For instance, some borrowers only require a small amount of financing for one or two small purchases. Others need large sums of money in order to cover larger expenses, such as weddings or medical procedures. You will also want to compare eligibility requirements for loans that interest you. For example, some banks have certain employment or monthly income requirements. Once you've narrowed the field of loans that fit your situation, you should try to find a loan that has a low total cost of borrowing as well as a monthly payment requirement that you are sure that you will be able to afford to pay each and every month of your loan's tenure.

Am I Eligible for a Personal Loan?

You may be wondering if you are even eligible for a personal loan. The first things that most banks will consider are your credit history, income level and employment circumstances. There are a variety of loans available for individuals of different employment and income situations. For example, some banks offer loans and interest rates specifically for salaried or non-salaried employees. Others offer loans that are specifically designed for high or low-income earners.

How to Apply for a Personal Loan

If you are interested in applying for a personal loan, you will be required to fill out an application form online or in-person. You may find that the bank is willing to negotiate from the advertised interest rate. This highlights the importance of comparing several rates before choosing to apply for your personal loan.

Examples Documents Typically Required for Personal Loan Application

Required DocumentSalaried ApplicantNon-Salaried Applicant
Proof of IdentityPassport, Drivers License, PAN
Proof of AddressPassport, utility bill
Proof of IncomeBank statement, Salary accountAudited financials, bank statement

Methodology

In order to identify the top personal loans in India, we researched and analysed more than 60 loans from 35 lenders, which are listed in our table below.

Lenders Reviewed in ValueChampion's Study
Aditya Birla CapitalAllahabad BankAxis BankBajaj FinservBank of Baroda
Bank of IndiaBank of MaharashtraCanara BankCapital FirstCentral Bank of India
CitibankDena BankFullerton IndiaHDB Financial ServicesHDFC Bank
ICICI BankIDBI BankIDFCInCredIndia Infoline Finance LTD
Indian BankIndian Overseas BankIndsuInd BankKarur Vysya BankKotak Mahindra Bank
SBISouth Indian BankStandard CharteredTamilnad Mercantile BankTATA Capital
UCO BankUnion Bank of IndiaVijaya BankYes Bank

After gathering interest rate, fee and other various data from these banks, we created an algorithm that compares the cost of borrowing of each loan. Our calculations include mandatory processing and administrative fees, interest costs and applicable promotions. We did not include fees for late or early payments, based on the assumption that the borrower would make timely payments. Because banks offer loans of various tenures and advertise ranges of interest rates, we calculated borrowing costs based on all possible scenarios in order to develop our list above.

William Hofmann

William is a Senior Research Analyst at ValueChampion Singapore, focusing on banking and SMEs. He previously was an Economic Consultant at Industrial Economics Inc.