In a world where financial needs can arise at any moment—be it for a medical emergency, home renovation, wedding, or travel—personal loans are a go-to solution. But here’s the catch: the interest rate makes all the difference. Choosing the best personal loan in India with low interest can save you thousands (if not lakhs) in the long run.
This in-depth blog is your trusted resource for identifying affordable loan providers, understanding what affects your loan’s interest rate, and how to maximize your approval chances.
Why Interest Rates Matter When Taking a Personal Loan
A lower interest rate reduces your overall repayment burden and makes your monthly EMIs more affordable. For example, on a loan of INR 5 lakh for 5 years, the difference between a 10% and 16% interest rate could cost you over INR 90,000. That’s why it’s vital to choose wisely.
Best Banks for Personal Loan Low Interest Rate (2025)
Here are some of the most trusted banks offering low-interest personal loans:
| Bank | Interest Rate (p.a.) | Processing Fee | Loan Amount | Tenure |
|---|---|---|---|---|
| HDFC Bank | 10.50% onwards | Up to 2.5% | INR 50,000 – 40 lakh | Up to 5 years |
| ICICI Bank | 10.75% onwards | Up to 2.5% | INR 50,000 – 20 lakh | Up to 5 years |
| Axis Bank | 10.49% onwards | Up to 2% | INR 50,000 – 40 lakh | Up to 5 years |
| IDFC First Bank | 10.25% onwards | NIL/low fee | INR 20,000 – 25 lakh | Up to 5 years |
| SBI Xpress Credit | 11.15% onwards | Up to 1.5% | INR 25,000 – 20 lakh | Up to 6 years |
Best Loan App in India with Low Interest
For those who prefer digital solutions, these apps offer competitive rates and easy application:
- Navi – Interest from 9.90% p.a., fully paperless
- PaySense – Flexible EMIs and minimal paperwork
- MoneyTap – Credit line system, use what you need
- CASHe – Known for small-ticket loans with decent rates
- Bajaj Finserv App – Interest rates from 11% p.a., wide network
Instant Personal Loan with Low Interest: How to Qualify
To increase your chances of getting the lowest interest rate:
- Maintain a CIBIL score above 750
- Choose a short repayment period
- Be salaried or work with a reputed employer
- Keep credit card balances low
- Apply directly on the bank’s or app’s official website
Personal Loan Interest Rate Comparison India
Interest rates vary by:
- Credit score
- Income level
- Loan tenure
- Bank’s risk assessment
Use loan comparison websites and tools before applying to get the best deal.
Personal Loan EMI Calculator India: Plan Before You Borrow
Use EMI calculators to check:
- Monthly installment amount
- Total interest payable
- Total repayment amount
For example:
- Loan: INR 5 lakh
- Tenure: 5 years
- Rate: 10.5% p.a.
- EMI: Approx. INR 10,746
Fixed vs Floating Interest Personal Loan
- Fixed Interest Rate: EMI remains the same; better for budgeting.
- Floating Rate: EMI changes based on market; can be risky but may benefit if rates fall.
Personal Loan Without Collateral Low Interest
All standard personal loans are unsecured. But to get low interest without collateral, ensure:
- Strong credit history
- Income stability
- Employer credibility
Government Personal Loan Schemes India
These government-backed programs also offer low-interest loans:
- PMMY (Pradhan Mantri Mudra Yojana): For small businesses and self-employed
- Stand-Up India Scheme: For SC/ST and women entrepreneurs
- CGTMSE Scheme: For MSMEs
Real-Life Case Study: Amit’s Loan Decision
Amit, a 30-year-old IT professional, needed INR 3 lakh for a family medical emergency. After comparing multiple apps and bank sites, he applied via the Navi app. With a 770 credit score, he was approved at 9.90% p.a. Loan was disbursed the same day, saving him nearly INR 12,000 in interest compared to other offers.
FAQs
Which bank gives personal loan at the lowest interest rate in India? As of 2025, Navi and IDFC First offer among the lowest rates starting at 9.90%–10.25%.
What is the eligibility for low-interest personal loans? Good credit score, steady income, employment with reputable organization.
Can I get a low-interest personal loan online? Yes, through apps like Navi, PaySense, and official bank portals.
Is a lower interest always better? Generally yes, but consider other charges like processing fees, prepayment penalties, etc.
What is the difference between fixed and floating interest rates? Fixed rates remain constant. Floating rates may increase or decrease based on the market.
Conclusion: Make the Smart Move
Getting the best personal loan in India with low interest is all about preparation. Check your credit report, compare offers, calculate your EMI, and read the fine print. Informed borrowers always save more—financially and mentally.
Apply smart, borrow wisely.