RBL Bank (previously Ratnakar Bank Limited) offers personal loans under a single category to salaried resident individuals at attractive interest rates. These loans can be utilised in any manner as seen fit by the individual and have a relatively faster time for processing. Personal loans are a go to solution when it comes to facing a sudden financial crunch, meeting an urgent purchase or spending obligation. With minimal documentation and short turnaround time, personal loans from RBL Bank can prove to be a boon for salaried individuals.
Personal loan interest rates have seen a gradual rise and a minimal decrease over the period ranging from 2011 to 2015. While in 2011 Q1, the personal loan interest rate was 8.50%, it gradually increased to a high of 11% by the end of 2011. There was a minor temporary drop of 0.10% during the second quarter of 2013 before returning to 11% in the last quarter of 2013. Following the directive issued by the Reserve Bank of India, after the imposed cut on the repo rate, RBL bank reduced the personal loan interest rate by 0.15% and as of May, 2015 it stands at 10.85%.
|Interest rate||14.5% p.a. to 23% p.a.||14.5% p.a. to 23% p.a.|
|Loan Amount||Minimum: Rs.1 lakh Maximum: Rs.20 lakh||Maximum: Rs.10 lakh Maximum: Rs.35 lakh|
|Loan Tenure||Minimum: 12 months Maximum: 60 months||Minimum: 12 months Maximum: 36 months|
|Lowest EMI||Rs.2,353 per month (calculated for the lowest amount taken for the longest tenure on offer at the lowest rate of interest)||Rs.34,421 per month (calculated for the lowest amount taken for the longest tenure on offer at the lowest rate of interest)|
|Processing Fee||1.5% of the loan amount subject to a minimum of Rs.7,500 (Non-refundable fee of Rs.5000 upfront. Rest at the time of disbursal)||1.5% of the loan amount subject to a minimum of Rs.7,500 (Non-refundable fee of Rs.5000 upfront. Rest at the time of disbursal)|
|Age||Minimum age when loan is sanctioned: 25 years. Maximum age at loan maturity: Less than 60 years or retirement age.||Minimum 27 years at the time of application. Maximum 65 years at loan maturity.|
|Prepayment Charges||No charge||Up to 15% of the outstanding principal amount within 12 months: No charge. Above 15% of outstanding principal: 2% of amount paid + service tax and other applicable charges.|
|Foreclosure Charges||No charge||3% on outstanding principal amount + service tax and other applicable charges|
After availing a personal loan of any amount from RBL Bank, the loan amount needs to be paid back in equated monthly installments (EMIs) and every EMI comprises a portion of the principal amount as well as the interest charged. As the personal loan moves towards its maturity, the principal portion gradually increases and the interest portion decreases.
The method for calculating the EMI on a personal loan can be mentioned as follows -
E = P*r*[(1+r)^n/((1+r)^n-1)]
Here E - Monthly EMI, r - rate of interest per month, n - number of years.
For a ballpark figure of Rs. 1,00,000 at an interest rate of 10.85% with a loan tenure of 1 year, the payable EMI would be Rs. 8,831 out of which the interest will account for Rs. 5,974.
For example, a personal loan of Rs. 5,00,000 for a period of 4 years at an interest rate of 10.85% from RBL Bank would have the following scenario for the EMI to be paid (starting from August 2015) -
|Year||Total Payment (INR)||Balance (INR)||Principal Portion (INR)||Interest Portion (INR)|
It is worthwhile to note that though the amounts of principal and interest keep varying throughout the loan tenure, the total EMI amount doesn’t change much.
RBL personal loan interest rates stay the same for any salaried individual who has been approved for availing a personal loan. The approval process might be dependent on several factors such as
All the above factors notwithstanding, any change in the advertised interest rates is at the sole discretion of the bank.
A personal loan can serve as an emergency financial airbag, but a bit of planning always helps and it especially comes in handy when dealing with CIBIL scores. Along with a credit history report, scores from CIBIL play a pivotal role in furthering the case of getting a personal loan approved from Kotak Bank. CIBIL scores range from 300 to 900 and a score above 700 is considered a good one. Scores above 750 might allow the bank to consider offering a better rate of interest to the customer. Else the rates might be higher than expected. Doing a check on the CIBIL score and fixing the same to an appreciable level might help in getting preferential interest rates.
Availing a personal loan from RBL Bank is easy for salaried individuals who meet the base minimum eligibility criteria, however, the following points should be borne in mind -