A personal loan is one of the most convenient ways to meet urgent financial needs. Whether you are planning a wedding, covering medical expenses, consolidating debt, or funding education, personal loans provide quick access to funds without the need for collateral. However, finding the best personal loan options with the lowest interest rate personal loan in India can save you significant money in the long run.
In this guide, we will explore the best personal loan interest rates in 2025, factors influencing them, eligibility, documents required, and expert tips to get the cheapest deals.
Best Personal Loan Interest Rates in 2025
As of 2025, some of the leading banks in India are offering competitive interest rates starting from around 9% per annum. Public sector banks generally provide the cheapest personal loan in India, while private banks and NBFCs are known for their faster processing and flexible terms.
- Public Sector Banks: Starting from 9.00% per annum
- Private Banks: Usually around 9.99% per annum onwards
- NBFCs: Begin around 10–13% per annum
This range highlights why it is crucial to compare personal loan interest rates in India before making a decision.
Personal Loan Options for Salaried Employees
Salaried employees often enjoy the best deals on personal loans because of their stable income. Some banks and NBFCs even provide pre-approved offers to salaried professionals.
Features for salaried employees:
- Lower starting interest rates
- Minimal documentation (salary slips, bank statements)
- Faster disbursal and approval
- Higher loan amounts compared to self-employed individuals
If you are a salaried professional, you are more likely to secure a personal loan with low interest rates.
Top Banks Offering Personal Loans at Low Interest Rates
Here are some of the top lenders known for providing affordable personal loans:
- Bank of Maharashtra – Among the lowest starting rates (~9% per annum)
- Punjab & Sind Bank – Competitive rates for salaried applicants
- Canara Bank – Affordable rates with moderate processing fees
- HDFC Bank – Popular for instant digital loan approvals
- Axis Bank – Offers flexible tenure and EMI calculator support
- IDFC First Bank – Zero foreclosure charges
- IndusInd Bank – Quick disbursal with personalized offers
These institutions consistently rank among the top banks offering personal loans at low interest rates.
Best NBFC for Personal Loans in India
Apart from banks, NBFCs (Non-Banking Financial Companies) also play a big role in personal loan lending. They are especially helpful for borrowers who may not qualify under strict bank criteria.
- Bajaj Finserv – Offers loans starting at around 10% per annum with flexible repayment options
- SMFG India Credit – Known for quick approvals, though rates are slightly higher
For individuals with unique needs or lower credit scores, NBFCs can be the best personal loan options despite slightly higher rates.
Personal Loan Eligibility and Documents
Every lender has its own requirements, but most follow a common framework.
Eligibility Criteria:
- Age: 21–60 years
- Income: Minimum ₹20,000–25,000 monthly (varies by bank)
- CIBIL Score: Ideally above 720 for the best personal loan interest rates in 2025
- Employment: Salaried or self-employed with stable income
Documents Required:
- Identity proof (Aadhaar, PAN, Passport, Voter ID)
- Address proof (Utility bills, rental agreement, Aadhaar)
- Income proof (salary slips, bank statements, ITR)
- Employment proof (offer letter, company ID)
Knowing your personal loan eligibility and documents in advance speeds up the approval process.
Best Personal Loan for Low CIBIL Score
A low CIBIL score is a major hurdle. However, it doesn’t mean you can’t get a loan.
Options include:
- Secured personal loans backed by fixed deposits or insurance policies
- Smaller loans from NBFCs, though at higher interest rates
- Adding a guarantor or co-applicant to strengthen your application
If you have poor credit, research the best personal loan for low CIBIL score to avoid rejections and high charges.
Personal Loan EMI Calculator India
An EMI calculator helps you estimate monthly installments based on loan amount, tenure, and interest rate. Most banks provide online calculators to help borrowers plan repayments.
For example:
- Loan Amount: ₹5,00,000
- Interest Rate: 10% per annum
- Tenure: 5 years
Your EMI would be around ₹10,624. Using a personal loan EMI calculator India ensures you borrow within your repayment capacity.
Tips to Get Lowest Interest Personal Loan
Here are practical ways to reduce your borrowing cost:
- Maintain a high CIBIL score (750+)
- Choose shorter tenure to pay less interest overall
- Avoid multiple loan applications that can reduce your score
- Negotiate with existing bank for loyalty benefits
- Opt for festive offers when lenders reduce rates
- Compare processing fees along with interest rates
- Transfer balance to a cheaper lender if your rate is too high
Following these tips to get lowest interest personal loan can save you thousands of rupees over the loan tenure.
Factors Affecting Personal Loan Interest Rates
Lenders assess multiple factors before deciding your rate:
- CIBIL Score: Higher score means lower interest
- Income: Stable and higher income earns better offers
- Employment type: Salaried employees usually get lower rates than self-employed
- Loan amount & tenure: Higher amounts and longer tenure may attract higher interest
- Relationship with lender: Long-term customers can negotiate better terms
Understanding these factors affecting personal loan interest rates helps you prepare for a successful application.
Best Personal Loan for Students in India
Students often face challenges in securing personal loans because of limited income. Still, there are options:
- Education loans from banks (secured by collateral or guarantor)
- Personal loans with parents as co-applicants
- Small NBFC loans targeted at students for specific needs
The best personal loan for students in India usually comes through co-signed applications or education-focused products.
How to Choose Best Personal Loan in India
Choosing the right loan requires careful research:
- Compare interest rates across multiple lenders
- Check processing fees and hidden charges
- Use EMI calculators to plan monthly budgets
- Review prepayment and foreclosure rules
- Look at approval speed and customer service
- Read terms carefully before signing
By considering these factors, you can confidently choose the best personal loan in India for your needs.
Conclusion
The Indian lending landscape in 2025 offers multiple choices for borrowers. From Bank of Maharashtra’s 9% starting rate to private banks like HDFC and Axis at 9.99%, and NBFCs like Bajaj Finserv at 10%, you have plenty of options.
By maintaining a good credit score, comparing rates, and understanding eligibility, you can secure the best personal loan options at the lowest interest rates.
Borrow smartly, repay responsibly, and use tools like EMI calculators to stay financially healthy.
