Personal loan interest rates in India span a wide band — 10.49% at the cheapest public-sector lender to 24% at risk-accepting NBFCs. On a ₹5 lakh loan over 5 years, that rate gap translates to a ₹2.2 lakh difference in total interest paid. Rate shopping is the single biggest lever you control on any personal loan. Here's our April 2026 snapshot of the 15 lenders we track, ranked by starting rate, plus the factors that decide what rate you actually get.
Rate comparison — 15 lenders (April 2026)
| Lender | Starting rate | Upper rate | Processing fee | Max amount |
|---|---|---|---|---|
| SBI Personal Loan | 11.15% | 14.75% | 1.5% | ₹20 lakh |
| Bank of Baroda | 10.49% | 15.60% | 2% | ₹20 lakh |
| Federal Bank | 10.49% | 17.99% | 0.5% min ₹500 | ₹25 lakh |
| IDFC FIRST Bank | 10.49% | 23.99% | 3.5% | ₹10 lakh |
| HDFC Bank | 10.50% | 24.00% | 2.5% | ₹40 lakh |
| ICICI Bank | 10.75% | 22.00% | 2.5% | ₹40 lakh |
| Axis Bank | 10.49% | 22.00% | 2% | ₹40 lakh |
| Kotak Mahindra | 10.99% | 24.00% | 2.5% | ₹25 lakh |
| IndusInd Bank | 10.49% | 24.00% | 3% | ₹50 lakh |
| Yes Bank | 10.99% | 20.00% | 2.5% | ₹40 lakh |
| Bajaj Finance | 11.00% | 31.00% | 3.93% | ₹40 lakh |
| Tata Capital | 10.99% | 29.00% | 3% | ₹35 lakh |
| Fullerton India | 11.99% | 30.00% | 3% | ₹25 lakh |
| Piramal Finance | 12.99% | 30.00% | 3% | ₹10 lakh |
| L&T Finance | 11.00% | 24.00% | 2.5% | ₹25 lakh |
The "starting rate" column is the lowest rate the lender publishes for its best borrower — typically an existing customer with 800+ CIBIL, 5+ years of employment at a Category-A company, and a low debt-to-income ratio. Most first-time applicants land 2-4% above the starting rate.
What actually decides your rate
1. CIBIL score — the single biggest factor
Banks price risk, and CIBIL is the cheapest risk proxy they have. The typical rate ladder:
- 800+: starting rate, often 10.49-11.00%.
- 750-799: starting rate + 1-1.5%.
- 700-749: starting rate + 2-3%, may need to switch to an NBFC.
- 650-699: 16-22% range, almost always at an NBFC.
- Below 650: 22-30% or outright reject.
If your score is under 750, our credit score improvement guide pays for itself — moving from 720 to 780 before applying often cuts 2% off your rate, worth ₹40,000+ over a 5-year ₹5L loan.
2. Employer category
Every major lender maintains an internal company list: Category A (top listed companies, MNCs, government), Category B (mid-size private, listed PSUs), Category C (unlisted SMEs), Category D (unknown employer). Moving from B to A typically saves 0.5-1% on rate.
3. Relationship with the bank
Salary account holders get 0.25-0.75% below card rate at most banks. SBI offers pre-approved YONO personal loans at 0.5% below their public card rate. If you bank primarily with one institution, check its app before rate-shopping elsewhere.
4. Loan amount and tenure
Counter-intuitively, larger loans often get lower rates. A ₹10L loan to a prime borrower is typically priced 0.25% below a ₹2L loan to the same person — banks prefer larger tickets with fixed underwriting cost. Longer tenure (5 years vs 3) usually adds 0.25-0.5%.
Fixed vs floating — which personal loans get which?
Almost all Indian personal loans are floating rate, benchmarked to the lender's MCLR or external benchmark (EBLR / repo rate). This means your EMI can change mid-tenure if the RBI changes the policy rate. Positive side-effect: RBI rules prohibit prepayment penalty on floating-rate individual loans, so you can prepay any time at zero charge.
A handful of NBFCs (notably Bajaj Finance and Tata Capital on some products) offer fixed-rate personal loans. These protect you from rate hikes but allow the lender to levy 2-4% prepayment penalty. Unless you're certain rates will rise sharply, the floating option is usually better.
Total cost comparison — ₹5L over 5 years
| Rate | EMI | Total interest | Total cost |
|---|---|---|---|
| 10.49% | ₹10,740 | ₹1,44,400 | ₹6,44,400 |
| 12.00% | ₹11,122 | ₹1,67,320 | ₹6,67,320 |
| 14.00% | ₹11,634 | ₹1,98,040 | ₹6,98,040 |
| 18.00% | ₹12,696 | ₹2,61,760 | ₹7,61,760 |
| 22.00% | ₹13,814 | ₹3,28,840 | ₹8,28,840 |
The jump from 10.49% to 22% costs ₹1.84 lakh extra interest — roughly 37% of the principal. That's why the 20 minutes spent comparing personal loans across five lenders is the single highest-ROI exercise in the entire borrowing process.
Check your actual rate in 30 seconds
Published rates are the floor, not the quote you'll get. The only reliable way to see your real rate is a soft-pull eligibility check — it doesn't touch your CIBIL. Use our loan eligibility calculator to see which of the 15 lenders above will approve you and at what rate, based on your income, employer, CIBIL band, and existing obligations. If you're unsure which loan type fits your need, start with our AI loan finder.
Planning an EMI-based strategy to consolidate credit card debt? Our credit card vs personal loan decision framework covers the break-even math.
Frequently Asked Questions
Which bank has the lowest personal loan interest rate in 2026?
Public-sector banks (Bank of Baroda, Federal Bank) and IDFC FIRST publish the lowest starting rates at 10.49%. Your actual rate depends on CIBIL, income, and employer category — most applicants land 2-4% above the starting rate.
Is a lower rate always better?
Not always — factor in processing fee (0.5% to 4%) and prepayment flexibility. A 11% rate with 0.5% fee can beat a 10.5% rate with 3.5% fee on a 2-3 year tenure. Always compare total cost, not headline rate.
Can I negotiate my personal loan interest rate?
Yes, at private banks and NBFCs, especially if you have a competing offer letter from another lender. Savings of 0.5-1% are common. Public-sector banks rarely negotiate — their card rates are board-approved.
Do all personal loans have floating rates?
No. Most banks offer floating; most NBFCs default to fixed. Floating rates carry zero prepayment penalty under RBI rules; fixed rates typically carry 2-4%. For most borrowers, floating is the better choice.
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Loans Editor, OnePaisa Editorial
Prasanth writes on borrowing for OnePaisa — personal, home, car and business loans, and the credit-score questions that decide what a borrower is actually offered. Interest rates, processing fees and eligibility rules in his guides come from lender schedules of charges and official product pages, are cross-checked against OnePaisa's verified lender data, and are dated so readers can see how current they are. A rate that a lender publishes as a range is published here as a range, never as a single teaser number.
Work published under this byline follows OnePaisa’s editorial standards — how our guides are researched, fact-checked against primary sources, and corrected.