Looking to secure a personal loan at the lowest interest rate? In 2025, several leading banks in India are offering personal loans with attractive rates and flexible repayment terms. Whether you’re financing a wedding, managing medical expenses, planning travel, or consolidating debt — choosing the right bank can save you thousands in interest.
Here’s a carefully compiled list of the top 20 banks providing personal loans with competitive interest rates this year.
💡 Why Consider a Bank for Your Personal Loan?
While many NBFCs and fintech lenders offer personal loans, banks are often a better choice due to:
Lower interest rates
Established credibility and regulatory oversight
More favorable prepayment or foreclosure options
Faster processing for existing customers
🏦 Top 20 Personal Loan Providers with Competitive Interest Rates
Below is a table featuring India’s top banks offering personal loans, with information on interest rates, loan amounts, and repayment periods:
Bank Name Interest Rate (p.a.) Maximum Loan Amount Loan Tenure
- HDFC Bank 10.50% – 21.00% Up to ₹40 Lakhs 1 – 6 years
- ICICI Bank 10.50% – 16.00% Up to ₹50 Lakhs 1 – 6 years
- Axis Bank 10.49% – 21.00% Up to ₹40 Lakhs 1 – 5 years
- IDFC FIRST Bank 10.75% – 18.00% Up to ₹40 Lakhs 1 – 5 years
- Kotak Mahindra Bank 10.99% – 24.00% Up to ₹25 Lakhs 1 – 5 years
- State Bank of India (SBI) 11.15% – 14.30% Up to ₹20 Lakhs 1 – 6 years
- Punjab National Bank 11.40% – 16.95% Up to ₹20 Lakhs 1 – 5 years
- Bank of Baroda 10.10% – 16.55% Up to ₹20 Lakhs 1 – 5 years
- Canara Bank Starting at 11.55% Up to ₹10 Lakhs 1 – 5 years
- Union Bank of India Starting at 11.00% Up to ₹15 Lakhs 1 – 5 years
- Indian Bank From 10.25% Up to ₹20 Lakhs Up to 7 years
- Bank of India From 10.85% Up to ₹20 Lakhs 1 – 5 years
- Federal Bank 10.49% – 17.99% Up to ₹25 Lakhs 1 – 5 years
- Yes Bank 10.99% – 23.00% Up to ₹40 Lakhs 1 – 5 years
- IndusInd Bank 10.50% – 23.00% Up to ₹25 Lakhs 1 – 5 years
- Karur Vysya Bank 10.75% – 16.75% Up to ₹10 Lakhs 1 – 6 years
- UCO Bank From 11.70% Up to ₹15 Lakhs 1 – 5 years
- South Indian Bank 11.25% – 18.00% Up to ₹25 Lakhs 1 – 5 years
- Karnataka Bank 11.00% – 17.00% Up to ₹10 Lakhs 1 – 5 years
- IDBI Bank 11.00% – 14.00% Up to ₹10 Lakhs 1 – 5 years
📊 How to Qualify for the Best Interest Rates
Banks evaluate several factors when deciding your loan offer. Here are a few ways to improve your chances of getting a low rate:
✅ Keep a Strong Credit Score
Aim for a CIBIL score of 750 or above. This indicates you’re financially responsible and trustworthy.
✅ Have a Stable Job and Income
Consistent income, especially from a reputed employer, increases eligibility and may qualify you for lower interest.
✅ Apply with Your Primary Bank
If your salary account is with the bank, they may offer special rates or pre-approved loans.
✅ Consider a Short Loan Tenure
Shorter repayment periods often result in better rates and reduced total interest cost.
❓ Frequently Asked Questions
Q. Which bank offers the cheapest personal loan in India in 2025?
A. Bank of Baroda and Indian Bank currently have some of the lowest starting rates — around 10.10% to 10.25% per annum.
Q. Can I apply for a loan with a low credit score?
A. Yes, but expect higher interest rates. If your score is under 700, try applying with a co-applicant or opt for a secured loan.
Q. How long does it take to receive funds?
A. Most banks now provide instant approval and disbursement within 24–48 hours for pre-approved applicants.
Q. Are there any additional charges I should be aware of?
A. Look out for processing fees (usually 1-2.5%), prepayment penalties, and late payment fees. Always read the loan terms carefully.
📌 Final Thoughts
Choosing the right bank can make a big difference in how much you repay over time. These top 20 banks offer safe, secure, and low-interest personal loans for your every need in 2025.
Before you apply, compare rates, read the fine print, and always check your credit report for errors. A well-informed borrower always gets the best deal!
