(FAQ) PERSONAL LOAN

Q. What are my loan limits?

A. Your personal loan limit would be determined by your income and repayment capacity. Normally you can avail a loan upto Rs.2.50 lacs. However, if in metros of NewDelhi, Mumbai, Bangalore, Chennai, Hyderabad and Kolkata, salaried individuals or self-employed professionals can avail Personal Loan upto Rs.5.00 lacs. If the salary of a salaried individual is credited to his/her account with our Bank or a self-employed professional has been maintaining a satisfactorily conducted account with us, a Personal Loan of up to Rs.10 lacs can be sanctioned.

Q. Can my spouses income be included for calculating the loan amount?

A. Yes, your spouse's income can be included provided he/she guarantees the loan or the loan is taken jointly.

Q. What are the important documents that I need to provide?

A. You will need to furnish only the following documents if you are an existing customer of the Bank:

  • Passport size photograph

  • Proof of official address for self employed individuals and professionals. This can include shop and establishment certificate/Lease deed/Telephone Bill

  • Latest Salary slip and Form 16, in the case of salaried persons

  • IT returns for the last two financial years, in the case of self employed individuals and professionals

If you are not an existing bank customer you would also need to establish your identity and give proof of residence.

Q. Do I have to pledge some form of security?

A. No security is required.

Q. What is the repayment schedule like?

A. The minimum amount that you are expected to pay every month is the EMI. You are allowed to pay more than the EMI if you wish to, and we do not charge any prepayment penalty.

Q. What is EMI?

A. EMI stands for Equated Monthly Installments. This installment comprises both principal and interest components. Use the EMI calculator to find out your monthly payments based on the loan amount, the rate of interest and the repayment period. Choose the combination that best meets your financial resources and requirements.

Q. Can I prepay the loan? Are there any penalties?

A. Yes, you can prepay the loan partly or fully, at any stage, without any prepayment penalty.

Q. What is the processing fee? Are there any other charges?

A. Processing charges are 1 per cent of the loan amount. This is amongst the lowest fees in the industry. Processing fees have to be paid upfront. There are no hidden costs or other administrative charges.

Q. Do I have the option of choosing a fixed or floating rate for the loan?

A. You have the option to avail the loan with either a fixed interest rate or a floating one. In the case of a fixed rate loan, the interest rate on the loan will remain fixed through the entire tenure of the loan, whereas in the case of a floating rate loan, the interest rate could decline or rise in line with the changes in the Bank's Medium Term Lending Rate (SBMTLR).

Q. How does SBI Personal loan compare with those offered by other banks?

A. There is total transparency with regard to the rate of interest and the fees charged by us.

  • We offer personal loans at the cheapest rates of interest, with no security or collateral

  • We offer loans for the longest tenors (48 months), with the flexibility provided to reduce the tenor by prepaying the loan without any penalty.

  • We provide finance for any personal need or requirement, the total amount being determined on the basis of repaying capacity.

  • With an SBI personal loan you can choose between fixed rates of interest and floating interest rates.

  • We levy interest based on daily/monthly reducing balance, unlike the annual reducing balance method used by several other banks.

Q. How do I benefit if the interest is calculated on a daily/monthly reducing balance?

A. On an annual reducing balance method, you will continue to pay interest on amounts you repay during the coming one year as the interest for the year is determined on the basis of the balance outstanding at the beginning of the year.

In the case of the daily/monthly reducing balance, which is the methodology we employ, your interest is calculated only on the outstanding loan amount, which reduces every time you pay off your EMIs or make any prepayments. This in essence lowers your effective rate of interest significantly.