Oriental Bank of Commerce Personal Loan Interest Rate

Note: *The EMI of Rs.2,172 has been calculated using a principal amount of Rs.1 lakh, an interest rate of 10.95% p.a., a tenure of 5 years, and a processing fee of 0.5% of the loan amount.

Different Personal Loan Schemes by OBC

The bank offers 3 loan options each designed for a particular group of people. The three loan options and their respective interest rates are given below:

1. Personal loans for government or PSU employees - 11.45% p.a.
2. Corporate employees - 12.45% p.a.
3. Pensioners - 10.95% p.a.

Factors Affecting OBC Personal Loan Interest Rate

1. Level of income: Every bank will have a minimum income level below which you will not be granted the loan. But earning above this income can benefit you. Earning a high income lowers your risk of loan default. This may cause the bank to give you a better rate of interest.
2. Job stability: Your job profile and the organisation your work for have a say in determining your interest rate. Working for a good company may indicate that you have a stable job. A stable job means a regular monthly income, and hence, a lower risk of loan default. The lower your risk level, the better the rate you may get.
3. Credit score: A high credit score indicates healthy financial practices and timely repayment of debt. Having a high score can help you get better rates from the bank. Low scores attract higher interest rates and may even result in loan application rejection.
4. Loan tenure: Banks may offer lower rates to borrowers who choose longer loan repayment periods. This is at the sole discretion of the bank and may vary from one bank to another.
5. Relationship with the bank: If you're already banking with OBC, you may get certain special privileges such as better interest rates, pre-approved loans, no extra documentation, and more.

How Interest Rates are Calculated (Illustration)

Illustrations can help shed light on how the interest rates work and how loan repayments are to be made. We'll look at two illustrations for this - one with a monthly income of Rs.25,000 and another with a monthly income of Rs.50,000.

Illustration 1: Sudeep wants to borrow a personal loan of Rs.1 lakh from OBC. He is currently earning Rs.25,000 per month as salary. His total work experience is 3 years. He has a credit rating of 610. The bank offers him an interest rate of 17.50% p.a. since his credit score is low. Sudeep wants to repay the loan over a period of 1 year. The bank charges him a processing fee of 1% of the amount he's applied for. Take a look at how his loan of Rs.25,000 will amortise over a period of 1 year.

Loan particulars:

1. Principal - Rs.1 lakh
2. Interest rate - 17.50% p.a.
3. Processing fee - 1% of the loan amount
4. Tenure - 1 year (12 months)

Note: The numbers in the example above are taken only for illustrative purposes. The actuals may vary. Please contact the bank for the correct figures.

Illustration 2: Sagar has been working for a total of 5 years. He earns a monthly salary of Rs.50,000. He wants to take a loan of Rs.1 lakh from OBC. He has a credit score of 856. The bank offers him an interest rate of 12.20% p.a. and charges him a processing fee of 1% of the loan amount. He chooses a tenure of 1 year. Sagar's loan of Rs.1 lakh will amortise as given in the table below.

Loan particulars:

1. Principal - Rs.1 lakh
2. Interest rate - 12.20% p.a.
3. Processing fee - 1% of the loan amount
4. Tenure - 1 year (12 months)

Note: The numbers in the example above are taken only for illustrative purposes. The actuals may vary. Please contact the bank for the correct figures.

A good credit score can help you secure lower interest rates on loans and credit cards.

Get Free Credit Score