We all have certain financial goals in our life which can be classified as short-term, medium-term and long-term. As a result, we consider the investment options that not only provide secure and high returns but also flexible tenure. But what about our instant goal or immediate needs where we need funds to face any type of emergency situation. When it comes to an immediate need, personal loans are the best to bet. A personal loan is an unsecured loan that assists you in addressing your immediate financial necessities. When it comes to urgent requirements, these may include activities like a vacation, paying for medical care, renovating your house, planning a wedding, funding your children's school, and so on. Borrowers choose a personal loan to pay all of these expenditures (if any) because it requires no collateral or security and requires minimum documentation with affordable interest rates. So if you have stuck against funding your immediate needs, here are the top 10 banks that are currently promising the cheapest rates on personal loans in the market.
Prerequisite for a personal loan
While applying for a personal loan, the only important prerequisite that is considered by every lender is the credit score. You can only get a personal loan with lower interest rates if you have an outstanding credit score. Therefore, if your credit score is poor, you may not be approved for a personal loan, and as a result, the interest rate will almost surely be more than those provided to customers with credit ratings of more than 750. Apart from a decent credit score, remember that the lender will determine the relevant personal loan interest rate and total loan amount based on various criteria such as your age, type of individual, income source, loan amount required, type of profession, and so on. Documentation also plays an important role when it comes to applying for a personal loan. With the nature of quick loan disbursal, you will be required basic documents such as Identity proof (scan copy of passport, voter ID card, driving license, Aadhaar, PAN), Address proof (scan copy of passport, voter ID card, driving license, Aadhaar), Bank statement of previous 3 months and Passbook of previous 6 months, latest salary certificate and Form 16, to apply for a personal loan instantly.
Interest rates on personal loans
Recently, a handful of public sector banks, such as the State Bank of India, Union Bank of India, and Canara Bank, have launched out COVID-19 personal loans at 8.5 per cent interest rates which are only to fund COVID treatment and not immediate liquidity requirement. However, if you're searching for a personal loan, here are the ten best deals being offered by some of the country's largest banks right now. The interest rates in the table are as same as it is advertised by the respective bank and may change based on the terms and conditions of the lenders and eligibility criteria.
|Banks||ROI p.a. in %|
|Union Bank of India||8.90|
|Central Bank of India||8.90|
|Punjab National Bank||8.95|
|Punjab & Sind Bank||9.50|
|Bank of Maharashtra||9.55|
|State Bank of India||9.60|
|Bank of Baroda||10.50|
|Source: Bank Websites|
Why should you take a personal loan for emergency needs?
Personal loans are unsecured kinds of lending that are commonly used to satisfy urgent financial needs. Its emergency lending nature allows you to use your loan amount for a range of subjects, including weddings, house renovations, vacation, and more. As it is an unsecured loan, the most appealing factor of this type of loan is that you won't have to put up any assets as security for your loan. With your credit score and required loan amount, if you fulfil the eligibility criteria of the lender, you may simply obtain a low-interest personal loan. Personal loans are available at a quick disbursal process, which makes them more outstanding or helpful for meeting emergency needs. No matter where you are, you can apply for a personal loan online from the convenience of your home or workplace anytime and anywhere.