Marriages in India are generally expensive due to the various wedding customs and rituals involved in them. Handling the finances of a wedding can have a huge impact on your savings if not planned in advance. Multiple banks as well as non-banking financing companies (NBFCs) provide custom, tailor-made personal loans called marriage loans to smoothen out any finance-related kinks you may face while planning for your entire wedding scenario.
A personal loan can be availed for various reasons such as home renovation, marriage of self or a family member, higher education, medical emergency, vacation expenses, and so on. In order to meet the rising need for customised personal loans, a number of major banks and NBFCs offer personalised loans to meet the specific financial requirement of the customers. The top lenders that offer personal loans in India are HDFC Bank, ICICI Bank, Tata Capital, State Bank of India, Axis Bank, Citibank, IDBI Bank, Punjab National Bank, Kotak Mahindra, Bank of Baroda, Capital First, etc.
The biggest benefit of personal loans is that the borrower does not need to disclose the reason for availing the loan and the funds received from this loan can be used for any purpose including marriage. Furthermore, since it is an unsecured loan, the applicant does not need to provide any guarantor or collateral in order to avail this kind of a loan. However, this means that a personal loan is a high-risk financing scheme in terms of the lender. Therefore, the policies and eligibility criteria in place for this scheme are much more strict as compared to other secured loans to ensure the timely repayment of the debt and reduce the chances of defaulting.
As per the recent guidelines from the Reserve Bank of India (RBI), personal loan interest rates should be dependent on the benchmark Marginal Cost of Funds-Based Lending Rate (MCLR) of the bank. Since the MCLR is updated according to the repo rate of RBI, the rate of interest will be revised after each time the repo rate changes. Therefore, it is advisable to get in touch with your bank to learn about the ongoing interest rate on personal loan. Furthermore, depending on the eligibility of the applicant, banks and NBFCs decide the applicable rate of interest on a loan withdrawn for marriage purposes.
See the table mentioned below to learn about the top banks that offer marriage loans along with the interest rate, processing fees, loan tenure, and pre-closure charges they carry:
|Name of the Bank||Loan Amount||Loan Tenure||Rate of Interest||Processing Fee||Pre-closure Fee|
|HDFC Bank||Up to Rs.15 lakh (for salaried individuals)||12 to 60 months||15% to 20.99% p.a.||Up to 2.5% of the loan amount with a minimum of Rs.1,999 and maximum of Rs.25,000||13 to 24 months - 4% of outstanding loan amount 25 to 36 months - 3% of outstanding loan amount More than 36 months - 2% of outstanding loan amount|
|ICICI Bank||Up to Rs.20 lakh||12 to 60 months||10.99% to 22% p.a.||Up to 2.25% of loan amount + taxes||5% of the balance amount + taxes|
|State Bank of India (SBI Xpress Credit Personal Loan)||Up to Rs.15 lakh||Up to 60 months or remaining period of service||11.15% to 15.15% p.a.||1% of loan amount + taxes||3% of the outstanding principal amount|
|Punjab National Bank||Rs.50,000 to Rs.10 lakh||Up to 60 months||MCLR + 2.80% to 6.55% p.a.||All borrowers - 1.80% of loan amount Pensioners - NIL||NIL|
|Axis Bank||Rs.50,000 to Rs.15 lakh||12 to 60 months||15.50% to 24% p.a.||1.5% to 2% + taxes||NIL|
|Tata Capital||Rs.75,000 to Rs.25 lakh||12 to 72 months||11.49% to 19% p.a.||Up to 2% of the loan amount||Up to 4% of the balance amount|
|Citibank||Rs.1 lakh to Rs.30 lakh||12 to 60 months||10.99% to 18% p.a.||Up to 2.5% of the loan amount||4% of the outstanding principal amount|
|Bank of Baroda||Rs.50,000 to Rs.10 lakh||Up to 60 months||MCLR + Strategic Premium + 3% to 8% p.a.||2% of the loan amount subject to a minimum of Rs.1,000 and maximum of Rs.10,000||2% of the balance amount|
|Bajaj Finserv||Up to Rs.25 lakh||12 to 60 months||13.99% p.a.||2.25% to 3% of the loan amount||4% on the balance amount + taxes|
|Kotak Mahindra Bank||Rs.50,000 to Rs.15 lakh||12 to 60 months||10.99% to 24% p.a.||Up to 2.5% of the loan amount + taxes||5% of the outstanding loan amount + taxes (after 12 months)|
|IDBI Bank||Rs.25,000 to Rs.10 lakh||12 to 60 months||12.49% to 13.49% p.a.||1 % of the loan amount + taxes||Within 6 months: 2% of the outstanding principal amount After 6 months: NIL|
|Capital First||Rs.1 lakh to Rs.25 lakh||12 to 60 months||Depends on the credit rating of the borrower||N/A||N/A|
To avail a Personal Loan for the purpose of funding your marriage, you must first see if you match the general eligibility criteria put forth by most banks and NBFCs. Your eligibility is dependent on a number of factors, a combination of which would not be the same for every applicant. Therefore, these also determine the maximum amount of credit that the borrower will be able to secure using this financing scheme. The eligibility criteria for a marriage loan includes:
It should be noted that different banks view these criteria differently. For example, Bank A may not require you to be any older than 21 years, but may require a CIBIL score of 800. On the other hand, Bank B may have a strict rule that you must be at least 23 years old, but can have a CIBIL score of 700. The banks basically decide your eligibility and maximum loan amount by your ability to repay the same.
Before banks and NBFCs approve or deny any loan application, they will require you to submit a full set of documents for their perusal. This set of documents contains information vital to the banks, to help identify you, your address, your employment or business details, and eventually decide whether you will be able to repay the loan or not.
A common set of documents must include:
Marriage loans are in most respects the same as personal loans, but are taken with the purpose of funding a marriage.
Marriage loans are basically a type of personal loan. Think of your loan as a personal loan, but for the purpose of funding your marriage.Does everyone get the same loan amount, interest rate and tenure since its a purpose-directed loan?
No, despite everyone takes the loan for a specific purpose, the loan amounts that get approved vary from one another and are dependent on a lot of factors.What are the factors upon which the loan amount depends?
Your loan amount that eventually gets approved or denied, depends on your age, net monthly income, employment type (salaried, self-employed, salaried professionals), employment status (term of employment, employability, etc.), CIBIL credit score, existing EMIs being paid, and in general, your ability to repay.What are the documents that the bank or NBFC will ask for?
The bank will require your proof of ID (with photograph), proof of address and proof of income along with a duly-filled and signed form and 2 passport-size photographs.Do any major banks offer marriage loans?
Most major banks and NBFCs in India offer marriage loans, like Punjab National Bank, ICICI Bank, State Bank of India, Citibank, IDBI Bank, Kotak Mahindra, HDFC Bank, Bank of Baroda, Capital First, Tata Capital, Axis Bank among many more.
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