Usually banks look for a good repayment capacity while providing a personal loan. This could be judged by the bank by taking cognizance of regular income and age of the applicant. The eligible age and the monthly / annual income would also depend on the type of income that the applicant gets – from a job which provides a salary or from a business that a self-employed applicant runs.
If you are salaried, then your age should be between 23 and 58 years, whereas the eligible slab for self-employed persons is between 28 and 65 years of age. The monthly income for salaried people should be Rs. 17000 per month, and higher for people living in metro cities. Since self-employed people have a variable income every month, their turnover should be at least Rs. 40 lakhs per year, and if they are self-employed professionals like doctors or architects, then the minimum eligibility of annual turnover is Rs.15 lakhs. An important parameter for personal eligibility is the CIBIL score, and banks look at a score above 750 to be a par score for a personal loan. Depending on age and income, a personal loan could be for any amount between Rs. 75000 and Rs. 20 lakhs for salaried persons, with self-employed persons being eligible for loans up to Rs. 15 lakhs.
|Providers||Interest Rate||Processing Fee|
|SBI||12.55%-17.65%||1%-3% of the loan amount + applicable Service Tax|
|Axis Bank||11.25%-24%||1.50%-2.00% of the loan amount + Service Tax, as applicable|
|ICICI Bank||11.29%-22.00%||Upto 2.50% of the loan amount + Service Tax, as applicable|
|Tata Capital Bank||11.99%||Starts at 999/-|
|PNB Bank||3.10%-6.10% + MCLR||Upfront fees: 1.80%+ST+Edu Cess|
|Upto Rs. 2 lac: Rs.270+ ST & Edu.Cess|
|Over Rs.2 lac: Rs.450+ST & Edu.Cess|
|For Defence Personnel: Only Upfront fee / No documentation charges.|
|Bajaj Finserv Bank||14.75%||2.25%-3% of the loan amount|
|Fullerton Bank||14%||Upto 6.5% of the loan amount|
|IndusInd Bank||Starting at 11.49%||Upto 2.5% of the loan amount|
|Standard Chartered Bank||Starting at 11.25%||Upto 2.25% of the loan amount|
|Citi Bank||10.99% to 17.99%||0.50% to 3%|
|HDFC Bank||11.29%-20%||Upto 2.5% of the loan amount, subject to a maximum of 25,000 INR and a minimum of 1,000 INR|
|Kotak Bank||Starting at 11.29%||Upto 2% + ST + Other levies|
|HSBC||11.99%||Upto 2.5% of the disbursed loan.|
|Bank of Baroda||11.35% to 14.35%||Rs.1,000 to Rs.10,000|
|Corporation Bank||12.75% to 13.75%||1.50% of the loan amount subject to a minimum of Rs.500/-|
|UCO Bank Personal Loan||11.35% - 11.60%||1% (min. Rs. 750)|
|Union Bank||14.40%||0.50% of the loan amount, Minimum of Rs. 500 plus service tax|
|Bank of India||12% to 14.5%||Rs. 1,000 to 10,000 + S.T.|
|Allahabad Bank||13.10%||1.22% (min. 1228)|
|Canara Bank||12.75% (Floating)||Rs. 1,000 to 5,000|
|IDBI||12.45% (3 months MCLR + 3.90%)||1% plus service tax|
|Bank of Maharashtra||12.75%||1.00% of the Loan Amount (Min.:Rs.1000/-)|
|Andhra Bank||13.05% to 14.30%||Nominal|
|Yes Bank||11.49%||upto 2%|
|Syndicate Bank||14.20% p.a.||0.5% with a minimum of Rs.500 + Service Tax|
|Vijaya Bank||12.5% to 13.5%||0.25% of the loan amount, Max Rs. 10000 plus service tax|
|Indian Bank||12.65% to 13.65%||Rs. 508 to 0.508%|
|Federal Bank||17.25%-35%||Upto 6.5% of the loan amount|
|Capital First||12%||upto 1.5%|
What Is A Personal Loan?
A personal loan is a simple and effective way to tide over a requirement of funds. Unlike other loans which are provided for a specific purpose, the lender of a personal does not ask you for the purpose of the money. The loan, which is unsecured (meaning it doesn’t need any collateral), depends on your credit history and repayment capacity, and its approval or approved amount doesn’t depend on what you will use it for. The approved loan amount is credited to your bank account in total, and the repayment, which begins from the next month, is of a fixed monthly amount called EMI. The two things which would affect the EMI would be the tenure of your loan (which usually is from one to five years), and the personal loan rate of interest you are charged. Whether you are salaried or self-employed, banks have personal loan products designed for you. Students, NRIs, pensioners, and senior citizens can also apply for personal loans, and each of these segments would have different eligibility criteria.
When Would You Need A Personal Loan?
There are several situations in which you could need a personal loan. There might be an impending marriage in the family, a medical emergency could have arisen, there could be substantial college tuition fees to be paid, or you might even be planning to go on a long vacation. Instead of coughing up money for all such expenses at once, you could go for a personal loan and repay over the next several months.
What Are The Pros and Cons Of A Personal Loan?
The biggest advantage of a personal loan is that there is no security involved, which also results in the approval process being much faster. It is a much better (read cheaper) option than taking an advance on your credit card, and if used for the purpose of home renovation, it can also offer you tax deductions for the interest repayment. On the flip side, the personal loan is unsecured and hence carries a much higher rate of interest than car or home loans.
What Are The Things To Consider While Selecting A Personal Loan?
The documentation required for a personal loan is not too detailed, and the approval process too takes a few days only. What you should rather spend time on is in comparing the various rates of interest, the amount you are eligible for, and the other charges that will be levied at the time of application or prepayment (foreclosing the loan earlier than its tenure).
How Can One Finance Help You?
What you need is an experienced and unbiased advisor who can help you with the correct selection of lender and also help with the actual application process when you are not sure how to apply for a personal loan. We will fulfil that role for you end to end, using our deep relationships with all major banks, which gives us visibility to the best personal loan offers. We will help you decide which bank is best for personal loan, we will collect your documents and submit them online or in person, and we will also follow up with the bank. In short, we would be a complete loan consultant to you till the amount is disbursed into your account.
Kotak Mahindra had been in financial services for a long time, but at the turn of this century, it also got a license for carrying on banking services. Since then, it has expanded its branch base and product portfolio to offer a wide range of products and services to a large part of our population. At present it is the fourth largest private sector bank in the country. Kotak Mahindra Bank has a number of innovative products, which have helped it become one of the most awarded banks of the country. Of these products, the personal loan is one of the most basic yet most popular products. The loan application and approval process of Kotak Mahindra is one of the simplest among all other banks, and also comes at very competitive interest rates.
Like any prudent banker, Kotak Mahindra lays down certain guidelines on which your creditworthiness is based. Personal loans need to have strict eligibility criteria because these loans are unsecured, and the borrower doesn’t keep any collateral with the bank. The first criteria is the age of the applicant. This is linked indirectly to the income, since the bank wishes to keep the age limits in such a way that the applicant would be likely to have begun earning before taking the loan, and would not have stopped earning before the loan is completely repaid.
Kotak Mahindra personal loan applicants must be between 21 and 55 years of age. Next comes the ability to repay the loan. This would be linked not only to the monthly income but would also take into account the other liabilities of the borrower which might get precedence over this loan’s repayment. The net monthly income of the borrower must be Rs. 25000, after deducting all fixed liabilities and commitments.
Apart from checking the absolute income level of the applicant, the bank also checks the tenure of the applicant in the job, and insists that the applicant should have been working for at least two years. Kotak Mahindra also looks at the residential stability of the borrower, and insists that the applicant should have been living for at least one year in the address whose address proof has been submitted. Finally, Kotak Mahindra offers personal loans only to salaried individuals who are working in large corporates, MNCs and public sector organizations. A borrower who has an existing Kotak Mahindra personal loan is also eligible for a top up of the existing loan.
Kotak Mahindra offers several options for the documents required for applying for a personal loan. The first document required is the identity proof, for which the following documents can be submitted – Passport, PAN Card, Aadhaar Card, Drivers’ License and Voter Id Card. Additionally, the bank would also accept employee ID, bank passbook or even a ration card. For proof of address the following are acceptable documents – Aadhaar Card, Passport, Current (2 months) utility bill, bank passbook or statement, Voter ID Card and Ration Card. As proof of ownership of residence, the deed of conveyance, the maintenance bill / receipt of the property, or the electricity bill of that residence can be produced. These identity, address and residence ownership documents combined with photographs of the applicant comprise the KYC documents. Additional to KYC, Kotak Mahindra insists on proof of income, financial status, and job or business stability. These are based on monthly salary slips, income tax returns (ITR), Form 16 documents, offer letter (for job tenure), tax registration details (for self-employed individuals) etc.
Kotak Mahindra adheres to the latest guidelines by the government and aligns its personal loan interest rates to the MCLR (Marginal Cost of funds based Lending Rate). Any new customers applying for a Kotak Mahindra personal loan would have their interest rates calculated as per MCLR, and the earlier borrowers will still continue to have their interest aligned to BPLR (base and prime lending rate). The MCLR currently being followed ranges from 8.9% for overnight rate up to 9.65% for three year tenure. The base rate is at 9.50% and the BPLR is at 18.25%.
Usually it has been observed that the base rate varies from 11.50% to 24%. Kotak Mahindra provides the best interest rates for Corporate Employees. The monthly repayment amount can easily be calculated from the EMI Calculator by submitting the tenure of the loan and the loan amount, for a particular rate of interest.
Apart from the interest rates charged by Kotak Mahindra Bank, there are certain other costs of the loan. Depending on the loan amount, a certain percentage (usually 2%) is charged as processing fee. Then there are charges for premature closure of the loan, and the amount of these foreclosure charges would depend on the period of the loan already passed. Apart from this, there would be certain charges levied for specific services like reissue of repayment schedule, bouncing of cheques, issue of interest certificate etc.