Personal Loan Interest Rates in India 2025: Complete Comparison & Eligibility Guide

The personal loan market in India has witnessed remarkable growth, with outstanding personal loans reaching ₹48.2 lakh crore by March 2025 according to RBI data. This represents a 24% year-over-year increase, driven by rising consumer spending, digitalization of lending processes, and innovative fintech solutions. With over 40 banks and NBFCs offering personal loans, Indian borrowers now have unprecedented options, but also face the challenge of identifying truly competitive rates. Get Instant Personal Loan in 10 Minutes – Try Fibe

Comprehensive Comparison of Personal Loan Interest Rates in India

Bank Personal Loan Interest Rates in India – April 2025

Bank	Interest Rate Range	Processing Fee	Loan Amount Range	Tenure Range	Prepayment Charges	Disbursement Time
HDFC Bank	10.50% – 16.50%	1-2.5% (max ₹12,500)	₹50,000 – ₹40 Lakhs	1-5 years	Nil after 12 months	24 hours
SBI	10.75% – 17.35%	1-2% (max ₹10,000)	₹25,000 – ₹20 Lakhs	1-6 years	2% of outstanding	2-3 days
ICICI Bank	10.65% – 17.50%	1.5-2.5% (max ₹15,000)	₹50,000 – ₹50 Lakhs	1-5 years	2% if <24 months	24 hours
Axis Bank	11.25% – 21.00%	1-2% (max ₹10,000)	₹50,000 – ₹40 Lakhs	1-5 years	2% if <12 months	24-48 hours
Kotak Mahindra	10.99% – 20.99%	1-2.5% (max ₹10,000)	₹50,000 – ₹40 Lakhs	1-5 years	2-3% if <12 months	24 hours
Citibank	10.50% – 14.99%	1-2% (max ₹10,000)	₹2 Lakhs – ₹30 Lakhs	1-5 years	2% of outstanding	3-5 days
Standard Chartered	11.49% – 16.00%	1-2% (max ₹10,000)	₹1 Lakh – ₹32 Lakhs	1-5 years	4% if <13 months	2-3 days

Interest rates from traditional banks start from 10.50% but can exceed 21% depending on borrower profile. HDFC Bank maintains the lowest starting rate, though approval at this rate typically requires excellent credit history (CIBIL >800) and high income stability.

NBFC Personal Loan Interest Rates in India – April 2025

NBFC	Interest Rate Range	Processing Fee	Loan Amount Range	Tenure Range	Prepayment Charges	Disbursement Time
Bajaj Finserv	11.00% – 28.00%	Up to 4%	₹30,000 – ₹25 Lakhs	1-5 years	4% if <12 months	15 minutes – 24 hours
Tata Capital	10.99% – 24.00%	2-3% (max ₹10,000)	₹75,000 – ₹25 Lakhs	1-6 years	3% of outstanding	24 hours
IIFL	12.00% – 28.00%	2-2.5%	₹50,000 – ₹15 Lakhs	1-5 years	3-5%	24-48 hours
Fullerton	14.00% – 32.00%	1.5-3%	₹25,000 – ₹25 Lakhs	1-5 years	5% if <12 months	24 hours
Aditya Birla Finance	11.50% – 22.00%	1-3% (max ₹10,000)	₹50,000 – ₹25 Lakhs	1-5 years	4% if <12 months	48 hours

NBFCs typically charge 1-3% higher interest rates than banks but offer more flexible eligibility criteria and faster processing. According to a CRIF report, NBFCs account for approximately 38% of total personal loan disbursals in India as of 2025.

Fintech Platform Personal Loan Interest Rates in India – April 2025

Fintech Platform	Interest Rate Range	Processing Fee	Loan Amount Range	Tenure Range	Prepayment Charges	Disbursement Time
FatakPay	11.99% – 21.00%	1-2%	₹10,000 – ₹10 Lakhs	3 months – 3 years	Nil	15 minutes
MoneyTap	13.00% – 24.00%	2-2.5%	₹25,000 – ₹5 Lakhs	3 months – 5 years	Nil	30 minutes
PaySense	16.00% – 36.00%	2-4%	₹5,000 – ₹5 Lakhs	3 months – 5 years	Nil	15-60 minutes
EarlySalary	18.00% – 30.00%	2-3%	₹8,000 – ₹5 Lakhs	3 months – 2 years	Nil	10 minutes
Navi	11.00% – 24.00%	1-3%	₹30,000 – ₹20 Lakhs	6 months – 5 years	Nil	30-60 minutes

Fintech platforms stand out for their rapid disbursement times, with FatakPay offering instant approval and disbursement in as little as 15 minutes through its proprietary underwriting algorithm. The convenience comes at a price, with interest rates typically 2-5% higher than traditional banks.

Personal Loan Eligibility Criteria Across Lenders in India

Income Requirements for Personal Loans by Lender Type

Lender Category	Minimum Monthly Income – Salaried	Minimum Annual Turnover – Self-employed	Min. Income for ₹5L Loan	Min. Income for ₹10L Loan
Public Sector Banks	₹15,000 – ₹25,000	₹5 Lakhs	₹30,000	₹50,000
Private Banks	₹20,000 – ₹35,000	₹7.5 Lakhs	₹35,000	₹60,000
Foreign Banks	₹30,000 – ₹50,000	₹12 Lakhs	₹60,000	₹1 Lakh
NBFCs	₹18,000 – ₹30,000	₹6 Lakhs	₹25,000	₹45,000
Fintech Platforms	₹15,000 – ₹25,000	₹4 Lakhs	₹20,000	₹40,000

According to a TransUnion CIBIL report, the average income of personal loan borrowers in India has increased by 18% over the past two years, reaching ₹42,000 monthly in urban areas and ₹32,000 in tier-2 cities.

Credit Score Requirements for Personal Loans in India

Credit Score Range	Loan Approval Chances	Interest Rate Impact	Banks/NBFCs That Consider	Required Documentation
750+	Excellent (90%+)	Best rates offered	All lenders	Standard documents
700-749	Good (70-85%)	+0.5% to +1.5% over base rate	Most lenders	Standard + additional income proof
650-699	Fair (40-65%)	+2% to +5% over base rate	Most NBFCs, select banks	Standard + collateral/guarantor recommended
600-649	Poor (15-35%)	+5% to +10% over base rate	Select NBFCs, fintech	Standard + collateral/guarantor mandatory
Below 600	Very Poor (<10%)	May not qualify	Few subprime lenders	Secured loans only

Nearly 63% of personal loans in India are approved for borrowers with credit scores above 750, while only 8% are approved for scores below 650 according to TransUnion CIBIL data from Q1 2025.

Employment Stability Requirements by Lender Type

Lender Type	Min. Employment Tenure (Salaried)	Min. Business Vintage (Self-employed)	Employer Category Preference	Job Stability Factor Weight in Decision
Public Banks	2-3 years	3-5 years	PSUs, Govt, Listed Companies	25-30%
Private Banks	1-2 years	2-3 years	MNCs, Listed, Large Companies	20-25%
NBFCs	1 year	2 years	Most organized sectors	15-20%
Fintech	6 months	1 year	Any registered company	10-15%

FatakPay’s proprietary algorithm places less emphasis on employment tenure (weighted at only 12%) and more on digital footprint and transaction history, allowing them to serve borrowers with shorter employment histories but strong financial behaviors.

Personal Loan Usage Patterns in India – 2025

Purpose of Personal Loans by Demographic

Loan Purpose	Percentage Share	Average Loan Amount	Typical Tenure	Predominant Age Group
Medical Expenses	22%	₹3.2 Lakhs	3 years	35-55 years
Wedding Expenses	18%	₹4.8 Lakhs	4 years	25-35 years
Home Renovation	16%	₹5.2 Lakhs	5 years	35-50 years
Debt Consolidation	14%	₹6.5 Lakhs	5 years	30-45 years
Education	12%	₹3.8 Lakhs	4 years	40-55 years (parents)
Travel	10%	₹2.2 Lakhs	2 years	25-40 years
Purchase of Consumer Durables	8%	₹1.5 Lakhs	2 years	25-40 years

Recent trends show debt consolidation increasing by 5 percentage points since 2023, indicating more Indians are using personal loans to manage existing high-interest debt, particularly credit card balances.

Personal Loan Delinquency Rates Across India – Regional Analysis

Region	Delinquency Rate	YoY Change	Average Loan Size	Major Contributing Factors
North India	3.2%	-0.5%	₹4.8 Lakhs	Improved collections
South India	2.3%	-0.8%	₹5.2 Lakhs	Strong employment sectors
West India	2.8%	-0.4%	₹5.5 Lakhs	Stable property values
East India	3.9%	+0.2%	₹3.2 Lakhs	Employment volatility
Metro Cities	2.6%	-0.6%	₹6.8 Lakhs	Stronger income stability
Tier-2 Cities	3.4%	-0.3%	₹4.2 Lakhs	Growing formal employment
Tier-3 & Rural	4.8%	+0.3%	₹2.8 Lakhs	Agricultural income variability

According to RBI data, the overall personal loan delinquency rate in India stands at 2.9% in 2025, a reduction from 3.3% in 2023, reflecting improved underwriting standards and better financial literacy among borrowers.

Personal loans in India continue to offer increasingly competitive rates, especially for prime borrowers. Traditional banks still offer the lowest interest rates starting from 10.50%, but fintech platforms like FatakPay are gaining market share through convenience and rapid disbursals despite slightly higher interest rates. As the market evolves, borrowers should compare not just interest rates but also processing fees, prepayment charges, and turnaround times to identify the truly best deals for their specific needs.