How to Apply for a Personal Loan With Low Interest in India (2025 Guide)
Are you planning a wedding, medical treatment, higher education, or a dream vacation but short on funds? A personal loan can be your best financial solution. But the key is to secure a personal loan with low interest—a move that can save you thousands of rupees in the long run.
In this detailed guide, we’ll walk you through the exact process of how to apply for a personal loan with low interest in India, including tips, documents required, and best lenders in 2025.
What is a Personal Loan?
A personal loan is an unsecured loan offered by banks, NBFCs, or digital lenders to meet various personal needs like weddings, travel, medical emergencies, etc. Since it's unsecured, you don’t need to provide any collateral.
Why Choose Low-Interest Personal Loans?
The lower the interest rate, the smaller your EMI. Even a 1-2% difference can impact your finances significantly.
Loan Amount:
- Rs. 5,00,000/-
- Tenure : 5 Years
- Interest Rate : 10%
- EMI : 10,624/-
- Rs. 5,00,000
- Tenure : 5 Years
- Interest Rate : 13%
- EMI : 11,377/-
Steps to Apply for a Personal Loan with Low Interest in India
1. Check Your Credit Score (CIBIL Score)
A high credit score (750+) improves your chance of approval and better interest rates. You can check your score from:
- CIBIL
- Paisabazaar
- BankBazaar
- OneScore App
2. Compare Loan Offers from Multiple Lenders
Don’t settle for the first offer. Compare interest rates, processing fees, and tenure from:
- Public Sector Banks: SBI, Bank of Baroda
- Private Banks: HDFC, ICICI, Axis Bank
- NBFCs: Bajaj Finserv, Tata Capital
- Fintech Lenders: MoneyTap, PaySense
| Lender | Interest Rate (2025) |
Processing Fee |
|---|---|---|
| SBI | 10.15% onwards |
Up to 1.5% |
| HDFC Bank | 10.50% onwards |
Up to 2.5% |
| ICICI Bank | 10.99% onwards |
Up to 2.5% |
| Tata Capital | 10.99% onwards |
Up to 2% |
3. Maintain a Stable Income
Banks favor applicants with steady income. Salaried individuals should have 2+ years of job experience. Self-employed should provide at least 2 years of ITR and income proof.
4. Keep Required Documents Ready
- Identity Proof: Aadhaar Card, PAN Card
- Address Proof: Utility bill, Passport
- Income Proof: Salary slips or ITR
- Bank Statements: Last 3–6 months
5. Apply Online for Pre-Approved Offers
Many banks offer pre-approved loans to existing customers with minimal paperwork. Check via net banking or mobile apps.
6. Use Aggregators for Best Offers
Visit platforms like Paisabazaar, BankBazaar, IndiaLends for instant loan comparison and customized offers.
Tips to Get Lowest Interest Rate on Personal Loan
- Maintain a credit score above 750
- Choose shorter tenure (1–3 years)
- Apply during festive offers
- Don’t apply to multiple banks at once
- Keep a low credit utilization ratio
Top Banks Offering Low-Interest Personal Loans (2025)
Lender :
- SBI
- Interest Rate : 10.15%
- Special Feature : Low processing fee, public sector
- HDFC Bank
- Interest Rate : 10.50%
- Special Features : Fast approval for customers
- ICICI Bank
- Interest Rate : 10.99%
- Special Features : Flexible repayment options
- Tata Capital
- Interest Rate : 10.99%
- Special Features : Minimal documents, online process
Common Mistakes to Avoid
- Applying without checking CIBIL score
- Not comparing loan offers
- Ignoring processing or prepayment fees
- Choosing longer tenure blindly
- Using untrusted digital apps
EMI Calculator Example
Loan: ₹3,00,000
Interest Rate: 11.5% p.a.
Tenure: 3 years
EMI: ₹9,859 approx
Conclusion
Getting a low-interest personal loan in India requires careful planning, comparison, and financial discipline. Always check your CIBIL score, research lenders, and avoid hidden charges. With the right steps, you can get the best deal and manage your EMIs easily.
FAQs – Personal Loan in India (2025)
Can I get a personal loan without a credit score?
Yes, but interest rates may be higher. Some NBFCs provide loans to new borrowers with no credit history.
Is online loan application better than offline?
Yes. Online process is faster, requires less paperwork, and offers better interest deals.
Is there a penalty for closing the loan early?
Many banks allow pre-closure after 6–12 months. Some may charge a small foreclosure fee.
Tags: personal loan low interest, personal loan India 2025, SBI personal loan, CIBIL score for loan, loan EMI calculator
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