The Reserve Bank of India (RBI) recently raised the risk weights for consumer credit exposure, particularly for personal loans, by 25 percentage points to 125 percent. This means that banks now need to hold more capital, increasing the cost of capital for these loans. Both existing and new loans are affected by this adjustment.
Consequently, borrowers may experience higher interest rates and limited access to credit as banks adjust their lending practices to meet the new capital requirements.
Here is the list of banks offering the cheapest personal loan interest rates, giving individuals the chance to access funds at affordable costs.
| Name of Banks/NBFCs | Interest Rates (p.a.) |
| Navi Finserv | 9.90% – 45.00% |
| HSBC | 9.99% – 16.00% |
| Faircent | 9.99% onwards |
| Bank of Maharashtra | 10.00% – 12.80% |
| Bank of India | 10.25% – 14.75% |
| Punjab National Bank | 10.40% – 16.95% |
| Axis Bank | 10.49% onwards |
| IndusInd Bank | 10.49% onwards |
| IDFC First Bank | 10.49% onwards |
| ICICI Bank | 10.50% onwards |
| HDFC Bank | 10.50% onwards |
| State Bank of India | 10.55% – 14.55% |
(Interest rates as of 22nd November 2023)
The Reserve Bank of India has also announced that all regulated entities must adhere to the new regulations by February 29, 2024.
Personal loan interest rates fluctuate based on factors such as the chosen bank and credit score. Prior to applying for a personal loan, it is crucial to compare the most recent interest rates and processing fees offered by various reputable banks.
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Updated: 23 Nov 2023, 02:04 PM IST