With ever-evolving financial needs, choosing the right personal loan can be challenging. One of the key factors to consider is the interest rate offered by your preferred bank. With rates starting at 9.75% per annum, selecting a loan that aligns with your income, credit score, and financial goals ensures a smooth borrowing experience.

Top 10 Banks Offering Lowest Personal Loan Interest Rates In 2025

Here is the list of the top 10 banks offering the lowest personal loan interest rates in 2025:

Note: Interest rates are as of March 25, 2025, and are subject to change without prior notice.

Types Of Personal Loan Interest Rates

There are mainly two different types of personal loan interest rates that are discussed below:

• Fixed Interest Rate: This interest rate includes a constant amount of interest levied by the respective bank on your loan. The value is decided based on factors such as tenure, repayment capacity, income generated, CIBIL score, etc. 
• Variable Interest Rate: Also known as adjustable interest rate, this value keeps on changing throughout the tenure of loan, depending on factors such as inflation, benchmark rate, economic indicators and more. 

How To Calculate Personal Loan Interest Rate?

Proper calculation of the interest as per the rates available in the market enrrowers to understand the repayment costs as Calculating the formula used to calculate equated monthly instalment (EMI) for a personal loan:

The formula to consider for calculating the eProperly calculatingment (EMI) for a personal loan is:

EMI = [P*R*(1+R) ^N] / [(1+R) ^N-1]

Where 

• EMI=Equated Monthly Instalment
• P=principal amount 
• R=monthly interest rate and 
• N =number of monthly instalments

How To Get Lowest Interest Rate On Personal Loan?

If you are looking for how to get the lowest personal loan interest rate in India, follow the below-mentioned tips:

• Raise Your Credit Score: Banks and financial institutions provide the lowest interest rate on personal loans to individuals with a high credit score. 
• Keep an Eye on Offers: Majority of banks provide special rates of interest to applicants to avail during festive occasions. This interest however remains for a limited time period only. 
• Prevent Missed Repayments: Banks consider your repayment history before providing you a desired loan amount at competitive interest rates. Applicants who have paid their EMIs and credit card bills previously are expected to charge a low interest rate. 
• Income: Applicants with low income pose a low risk to banks and can avail loans at low interest rates. On the other hand, individuals with a low annual income end up paying a high interest rate. 
• Comparison of Interest Rates: Ensure to compare interest rates being provided by various banks to opt for one with the rate, thus suiting your needs and repayment capacity. 
• Loyalty Benefits: If you are an existing customer of a bank, you might be offered a low rate of interest while applying for a personal loan. This however depends from one bank to another. 

Lowest Personal Loan Interest Rate For Salaried Employees

The lowest rate of interest applicable for personal loans for salaried employees is 9.75% per annum, as provided by the Indian Bank. The interest rate depends on several factors, including the loan amount, tenure, CIBIL score, income, and others, which we have already discussed in detail above.

Lowest Personal Loan Interest Rate For Government Employees

For government employees seeking the lowest interest rate on a personal loan, interest rates can start as low as 10.30% per annum. Several banks and financial institutions offer competitive rates and attractive terms for this segment. The State Bank of India provides this interest rate for coast guard, paramilitary, and defence personnel.

When choosing a personal loan in 2025, compare banks based on interest rates, processing fees, tenure, and prepayment charges to secure the best deal.