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  • Federal Bank Personal Loan Interest Rates

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  • Interest rates offered by Federal bank will be based on the risk appetite of its customers. The interest rate for Personal Loan ranges from 10% to 27% p.a. The MCLR rates for Federal Bank personal loans are determined by taking the operating costs, negative carry on Cash Reserve Ratio (CRR), the marginal cost of funds of the bank, and the tenor premium into consideration. The final lending rates of the various loans and advances provided by the bank are fixed by adding the spread to the specific MCLR of a particular tenor.

    Particulars Salaried/Self-Employed/Retired employees
    Interest rate 10.00% to 27.00% p.a.
    Loan Amount Max loan up to Rs 25 lakh
    Loan Tenure Up to 48 months
    Processing Fee Up to 3% (Minimum Rs.500)
    Age Applicants must not be more than 55 years of age at the time of applying for the loan.
    Prepayment Charges Higher amount of 3% on the outstanding balance or the DP

    From renovating your home and buying appliances to funding college education and weddings, personal loans offered by Federal bank can help you fulfil any of your dreams. Customers can acquire a personal loan with the help of simple, minimal documentation in addition to a hassle-free process. Federal bank offers personal loans for a tenure of 48 months. Customers do not have to provide any guarantors to avail of personal loans offered by Federal bank. With over 1000 branches in the country, Federal bank ensures that customers get the desired products.

    Features and Benefits of availing a Federal Bank personal loan

    Some of the features and benefits of availing a Federal Bank personal loan are given below:

    • You can avail a maximum loan amount of Rs.25 lakh.
    • The repayment tenure ranges between 1 year and 4 years.
    • Interest rates offered are attractive in nature.
    • Minimal paperwork is required, thus saving you time and effort.

    Factors affecting Federal Bank Personal Loan interest rates

    There are various factors which affect interest rates offered on Federal bank personal loan as listed below.

    • Loan tenure: Interest rate offered by Federal bank depends upon the loan tenure chosen by customers. If the customer opts for a short loan tenure, the bank is most likely to charge a higher interest rate as compared to loans offered on longer tenures.
    • Relationship with Federal bank: If a customer has a good rapport with his or her bank, there is no trust deficit. Consequently, the bank will be in a position to reduce their interest rates offered to privileged customers. Also, a long-standing customer of a bank can negotiate a lower interest rate, provided he or she fulfills all the required eligibility criteria for availing of a personal loan.
    • Repayment capacity: The repayment capacity of a borrower is of seminal importance. Banks usually provide personal loans up to 10 times the monthly salary of a customer. Banks check the CIBIL score of an applicant to determine his repayment capacity. Federal bank will offer attractive interest rates to loan applicants with a regular income and a robust credit history,
    • Employment details: The employment history and profile of a customer plays a pivotal role in determining the interest rates offered by Federal bank. Salaried individuals working with high net worth companies may be offered lower interest rates as compared to those who are self-employed, who, typically, don’t have a steady income.

    Note: Federal bank can alter its Interest rates at its discretion.

    Key things about Federal bank Personal Loan interest rates

    • It is always prudent to have a robust credit score to avail of the credit facility from any bank. A good credit score paves the way for a loan getting approved in that all banks including Federal bank review the credit history and repayment capacity of an individual before approving a loan.
    • When the RBI raises the repo rate, banks do not immediately raise their interest rates. In several cases, if a bank has had a lean growth rate, it will be reluctant to immediately pass on the increased rates to its customers. Banks analyze their liquidity and cost of funds before passing on the hike in repo rate to their customers by way of increased interest rates.
    • Floating interest rate changes as per the bank’s base lending rate.

    How to Calculate Interest/EMI on my Federal Bank Personal Loan?

    EMI comprises the interest on loan in addition to the principal to be repaid. The sum of principal and interest is divided by the tenure of the loan. Top rate aggregator websites such as bankbazaar.com provide a personal loan EMI Calculator which helps customers calculate the exact EMI which needs to be paid. All a customer has to do is enter the details of loan amount, tenure, interest rate applicable and processing fee, if any and click ‘calculate’. The customer will then find all the required information such as amortization figures and loan repayment figures for a specific loan amount. An amortization table provide a breakdown of loan repayment. Floating Rate EMI calculation:

    Illustration

    1. For Salary of Rs.25,000 Per Month 

    Mrs. Jamie earns a monthly salary of Rs.25,000 and has a credit score of only 620. She avails a loan of Rs.2 lakh from Federal Bank with a repayment tenure of 1 year. Due to her low credit score, she is charged with an interest rate of 24% and a processing fee of 0.5%. The monthly EMIs that she will have to pay are given in the table below:

    Loan amount Rs.2 lakh
    Processing fee 0.5%
    Loan tenure 1 year
    Interest rate 24% p.a.
    Month Principal Paid(A) (in Rs.) Interest Paid(B) (in Rs.) EMI (A+B) (in Rs.) Outstanding Loan Balance (in Rs.)
    1 Rs.14,912 Rs.4,000 Rs.18,912 Rs.1,85,088
    2 Rs.15,210 Rs.3,702 Rs.18,912 Rs.1,69,878
    3 Rs.15,514 Rs.3,398 Rs.18,912 Rs.1,54,364
    4 Rs.15,825 Rs.3,087 Rs.18,912 Rs.1,38,539
    5 Rs.16,141 Rs.2,771 Rs.18,912 Rs.1,22,398
    6 Rs.16,464 Rs.2,448 Rs.18,912 Rs.1,05,934
    7 Rs.16,793 Rs.2,119 Rs18,912 Rs.89,141
    8 Rs.17,129 Rs.1,783 Rs.75,648 Rs.72,011
    9 Rs.17,472 Rs.1,440 Rs.18,912 Rs.54,540
    10 Rs.17,821 Rs.1,091 Rs.18,912 Rs.36,719
    11 Rs.18,178 Rs.734 Rs.18,912 Rs.18,541
    12 Rs.18,541 Rs.371 Rs.18,912 Rs.0

    2. For Salary of Rs.50,000 Per Month 

    Mr. Kurnool earns a monthly salary of Rs.50,000 per month and has a credit score of 750. He avails a personal loan of Rs.2 lakh for a tenure of 1 year from Federal Bank. Due to his impressive credit score he is charged a relatively lower interest rate of 10% and a processing fee of 0.5% on his loan. The monthly EMIs that he will have to pay are given in the table given below:

    Loan Amount Rs.2 lakh
    Processing Fee 0.5%
    Loan Tenure 1 year
    Interest Rate 10%
    Month Principal Paid(A) (in Rs.) Interest Paid(B) (in Rs.) EMI (A+B) (in Rs.) Outstanding Loan Balance (in Rs.)
    1 Rs.15,917 Rs.1,667 Rs.17,584 Rs.1,84,083
    2 Rs.16,049 Rs.1,534 Rs.17,583 Rs.1,68,034
    3 Rs.16,183 Rs.1,400 Rs.17,583 Rs.1,51,851
    4 Rs.16,318 Rs.1,265 Rs.17,583 Rs.1,35,534
    5 Rs.16,454 Rs.1,129 Rs.17,583 Rs.1,19,080
    6 Rs.16,591 Rs.992 Rs.17,583 Rs.1,02,489
    7 Rs.16,729 Rs.854 Rs.17,583 Rs.85,760
    8 Rs.16,869 Rs715 Rs.17,584 Rs.68,892
    9 Rs.17,009 Rs.574 Rs.17,583 Rs.51,882
    10 Rs.17,151 Rs.432 Rs.17,583 Rs.34,732
    11 Rs.17,294 Rs.289 Rs.17,583 Rs.17,438
    12 Rs.17,438 Rs.145 Rs.17,583 Rs.0

    How CIBIL score affects Federal bank Personal Loan interest rate?

    CIBIL score reveals an individual’s repayment capacity and credit history. A robust CIBIL score will boost the chances of a loan applicant to acquire a personal loan at competitive interest rates. If loan applicants have a low CIBIL score, they are unlikely to get their loan approved. If Federal bank decides to approve a loan request by an individual who has a low credit score, the interest rate charged on the loan may be higher compared to those who have a good credit score.

    FAQ's

    1. How do I repay my Federal Bank Personal loan?
    2. You can repay your Federal Bank Personal Loan through Equated Monthly Instalments or EMIs. You can use one of the following methods to make the payment:

      • You can give a standing instruction to your bank.
      • You can use the Federal Bank internet banking system known as FedNet.
      • You can use the Federal Bank mobile banking application known as Fed Mobile.
      • You can opt for an automated payment option through Electronic Clearing Service or ECS.
    3. How can I track the status of my Federal Bank Personal Loan?
    4. You can easily track the status of your Federal Bank Personal Loan or FedPremia if you apply for the loan through a third-party aggregator website such as BankBazaar. You can log in to your BankBazaar profile and check the status of the loan. On the other hand, you will also receive regular email and SMS updates regarding the loan status on your registered email ID and phone number.

    5. Why do I need to provide KYC documents?

      KYC or Know Your Customer is a process which is used to gather the details pertaining to the identity and address of a customer. KYC is mandatory for all customers as it ensures that the services provided by the bank are not misused.

    6. How can I get in touch with Federal Bank?
    7. You can either visit one of the nearest Federal Bank branches or you can also call the 24x7 customer care call centre of the bank at 1800 420 1199 or 1800 425 1199. You can also get in touch with the bank by sending an e-mail to contact@federalbank.co.in.

    8. How can I locate the nearest Federal Bank branch office?
    9. You can locate the nearest Federal Bank branch office, ATMs, zonal offices, and/or contact centres through the Federal Bank website. Under the ‘Locate Us’ option on the website, click on the ‘Branches and ATMs’ option to find out the nearest branch office.

    10. What are the documents that I will have to submit in order to avail a personal loan from the bank?
    11. You will have to provide a list of KYC (Know Your Customer) and Income documents. The list of documents that you will have to provide are given below:

      KYC documents:

      • Identity proof
      • Address proof
      • A copy of your PAN card
      • 2 passport size photos

      Income documents:

      • Duly signed loan application form
      • Form 16
      • Salary slips for the last 3 months
      • Salary account statement for the last 6 months.
    12. What should be my minimum work experience in my current job so that I can apply for a Federal Bank personal loan?
    13. You should have a minimum work experience of 3 years in your current job in order to be eligible for a Federal Bank personal loan.

    14. How important is my credit score if I wish to avail a personal loan from Federal Bank?
    15. Your credit score plays a very important role in determining whether you can avail a personal loan at a low interest rate. Having a high credit score indicates that you will be in a position to repay the loan amount on time. Banks generally charge higher interest to people with a lower credit score or do not approve the application for a personal loan. Thus, you must ensure that you have a credit score of 750 and above if you wish to avail a Federal Bank personal loan.

    16. What is the Federal Bank personal loan interest rate for salary account holders?
    17. Federal Bank offers personal loans at interest rates between 10% p.a. and 27% p.a. for salaried account holders.

    18. Can I close my Federal Bank personal loan after 1 year?
    19. Yes, you can pre-close your Federal Bank personal loan after 12 months.

    20. How can I close my Federal Bank personal loan online?
    21. You have to visit the Federal Bank branch holding your account to close your account as there is no online pre-closure option available.

    22. How can I close my Federal Bank personal loan before 1 year?
    23. Foreclosing your personal loan will be subject to the terms and conditions as set by Federal Bank.

    24. Can I negotiate with Federal Bank for the personal loan interest rate?
    25. Yes, if you have a good relationship with Federal Bank, you can negotiate to get a better interest rate offered on the personal loan.

    26. Is it possible for non-Federal Bank customers to get a personal loan from Federal Bank?
    27. Yes, non- Federal Bank customers can also apply for a personal loan.

    28. How can I check my Federal Bank personal loan balance?
    29. You will have to request the bank to issue the repayment schedule to check your personal loan balance or you can visit the nearest bank branch to know your personal loan balance.

    30. How can I pay my Federal Bank personal loan EMI through net banking?
    31. Firstly, you will have to link your personal loan account to your net banking account. You can then choose to make the payment through the auto-debit option for EMIs.

    32. How can I get my Federal Bank personal loan statement?
    33. You can download your personal loan account statement when logged into your net banking account. The statement will display a record of your past EMI payments.

    34. How can I pay my Federal Bank personal loan EMI online from another bank?
    35. You can link your Federal Bank personal loan to your net banking account and make the payment even if it is a non-Federal Bank account.

    36. How can I get Federal Bank personal loan status on my mobile number?
    37. Ensure that your mobile number is registered with Federal Bank to get personal loan statuses.

    38. What is the Federal Bank personal loan disbursement time?
    39. Federal Bank promises quick personal loan disbursals following approval of the application.

        

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