Union Bank and Punjab National Bank (PNB) and, the leading public sector lenders in India, offers low-cost personal loans to its customers. As per data from BankBazaar, Union Bank of India ranks top position in the list of cheapest lenders with 8.9 percent for a loan of Rs 5 lakh with a five-year tenure. Punjab National Bank (PNB) and Central Bank of India are next on the list with 8.95 percent.
There is a good chance that people overshot their shopping budget because of the festive season has just passed by, thanks to the plenty of offers in the backdrop of the COVID-19-induced economic slowdown. There is a high possibility that in the quest for making the most of the offers, many might have taken overused credit card limits or personal loans. Unsecured loans come with high-interest rates. The customers must take into account personal loans only for emergencies, after exhausting all the much-cheaper secured loan options such as stocks, mutual funds, top-up home loans and loans against life insurance policies.
Indian bank is the fourth in the list with 9.05%. State Bank of India (SBI) is charging 9.6 percent as the interest rate for a Rs 5-lakh personal loan. Bank of Maharashtra and UCO bank in the fifth and seventh position with 9.55% and 10.05% respectively. As per the data available in BankBazaar website, Bank of Baroda, Federal Bank and HDFC bank provides interest at higher rate comparatively. They offer interest rate of 10.10%, 10.49%, and 10.75% respectively.
For the data compilation, interest rates on the personal loan for all listed (BSE), public and private banks have been considered. The banks which do not provide data on their websites are not considered. The data which was collected from respective banks’ websites as on November 26, 2020. The Banks are listed in ascending order based on interest rates, the bank offering lowest interest rate on personal loans is placed at top and highest at the bottom. The interest rates cited are indicative and may vary depending on the bank’s terms and conditions.