Sometimes circumstances can lead to individuals falling into debt trap. Even people who’ve not taken credit in their lifetime have to knock the doors of credit lenders to fulfill short term money requirement which can be as low as one year.
Let’s take example of Ravindra whose father recently got health problem. Although he had taken health insurance separately for his parents, but the same was insufficient due to the cost involved in the overall treatment. He was actually short of Rs. 3, 00,000 (3 Lacs).
In fact, his personal saving was not sufficient and taking help from friends/acquaintances was not possible, and he also had other ongoing financial commitments. So one of his friend suggested to take personal loan for one year, which seemed to be the best option at that point which was able to fulfill all his requirements. And he successfully got it without much efforts, thanks to his excellent credit history.
Read more on personal loan for low income earner.
Listed below are the banks he researched and also calculated interest amount on personal loan for 1 year. Although he opted for loan from the lender who offered best deal keeping in mind his overall financial commitments.
|Name of Bank||Interest Rate for One Year||Interest Amount in INR for Rs. 3 Lac Loan|
|State Bank of India||12.50% - 16.60%||Rs. 23233 @14%|
|ICICI Bank||11.59% to 22.00%||Rs. 21542 @13%|
|Kotak Mahindra||11.50 - 20.00%||Rs. 28337 @17%|
|HDFC Bank||11.29 - 19.50%||Rs. 22387 @13.5%|
|Bajaj Finserv||11.49 - 16.00%||Rs. 24929 @15%|
|IndusInd Bank||12.99 - 17.00%||Rs. 26631 @16%|
|Citibank||0.1149||Rs. 19855 @12%|
|Standard Chartered||11.99 - 15.00%||Rs. 24929 @15%|
|Axis Bank||15.50% to 24%||Rs. 30048 @18%|
Note: Banks keep on changing the personal loan interest rate time to time. So please check current rates with the bank before applying for the loan.
- PAN Card
- Income tax returns
- Salary slip or certificate
- Form 16
- Passport/Driving license/Voter ID card
- Address proof or office ownership proof – Leave or license agreement, utility bill
- Bank statement minimum 6 months
There are two other commonly available options to get personal loan for one year:
- Peer to peer lending (P2PL)
- Private financiers
Amongst these two, P2PL should be preferred due to the risks involved in private financiers such as harassment due to non-payment of dues. Moreover the interest charged is very high in case of local money lenders.