Comparing Personal Loan Interest Rates: PSU vs Private Banks in 2026
Lowest personal loan interest rates 2026: Compare PSU vs private bank rates before you apply
The Economic Times
Image: The Economic Times
As of April 15, 2026, personal loan interest rates vary significantly between public sector banks (PSUs) and private banks in India. The lowest rates from PSUs start at 8.75%, while private banks begin at 9.60%. Borrowers should compare options to find the best fit for their financial needs.
- 01Lowest personal loan interest rates from public sector banks start at 8.75%.
- 02Private banks offer rates starting from 9.60%.
- 03Processing fees vary, with some banks charging up to 5%.
- 04Loan terms and EMIs differ significantly across lenders.
- 05Careful comparison is essential before applying for a personal loan.
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As of April 15, 2026, personal loan interest rates in India show a notable difference between public sector banks (PSUs) and private banks. The lowest interest rates from PSUs start at 8.75%, offered by Union Bank of India and Bank of Maharashtra. For a loan of ₹5 lakh over five years, the EMI ranges from ₹10,319 to ₹11,934, depending on the lender. Private banks, on the other hand, have starting rates from 9.60% with Axis Bank. Their EMIs for the same loan amount begin at ₹10,525. Processing fees can also vary, with some banks charging up to 5%. Borrowers are advised to compare interest rates, EMIs, and processing fees to ensure they select the most suitable loan option for their financial situation.
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Choosing the right personal loan can significantly affect monthly budgets. A lower interest rate can reduce monthly EMIs, making loans more affordable for borrowers.
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