Banks are giving attractive offers such as low interest rates and no processing fees
Looking for a loan? You don’t have to look too far. Faced with slackening credit demand from the corporate sector, banks are pushing retail loans. Calls offering upgrades of credit cards, pre-approved loans and unsolicited cheques one can deposit in his/her account and treat these as a personal loan are doing the rounds again.
Since the Diwali season, banks started reducing interest rates and waiving or lowering processing fees on secured products such as home loans. With the latest cut in interest rates, State Bank of India ( SBI) continues to offer the lowest rate on home loans. Now, the interest on an SBI home loan of up to Rs 30 lakh is 9.95 per cent; for loans of more than Rs 30 lakh, it is 10.1 per cent.
ICICI Bank and Axis Bank also have innovative offers on home loans. ICICI Bank offers one per cent cash back on every equated monthly instalment ( EMI) for the entire tenure of the loan. Axis Bank has the ‘Happy Ending Home Loan’ scheme, which waives the last 12 EMIs, provided the initial loan period is 20 years and the borrower has made repayments for at least 15 years.
Many banks have also extended discounts announced during the Diwali season. Some also have innovative offers on unsecured products such as credit cards and personal loans. HDFC Bank, for instance, offers a personal loan approval in two minutes in case the application is online and the loan amount is less than Rs 7.5 lakh., Axis Bank, says banks have been focusing on the retail segment, especially in the last two years. As part of its retail bouquet, Axis Bank is offering personal loans at special rates for government employees and defence personnel. Small banks, too, have been quick to jump on the retail bandwagon. Federal Bank, which recorded 25 per cent growth in its retail segment in the December quarter, is focusing on small and medium enterprises and the retail segment, even as it cuts corporate exposure, both in loans and deposits, says D Sampath, head (retail). The bank has been growing its gold loan and automobile loan portfolios. After the repo rate cut by the Reserve Bank of India, it was one of the first to cut rates on automobile loans. The bank is offering automobile loans at a flat 10.45 per cent (earlier it offered these at 11.2-11.7 per cent, depending on the tenure). It has also reduced the turnaround time for approval of automobile loans.
Non-banking financial company Bajaj Finserv offers online approval of personal loans to premium salaried professionals. For loans of up to Rs 15 lakh, the company promises approval in five minutes and disbursal within 72 hours. The company’s personal loan segment was growing at 20 per cent a year, said a note by Bajaj Finserv. In the case of personal loan offers that seem too good to be true, one must check if the rate being quoted is on a monthly reducing balance or a fixed balance, says Aadhil Shetty of Bankbaazar.com. If it is on a fixed balance, the rate might be much higher in the long run. Borrowers must also ensure the processing fee is not too high for such products.
Looking for a loan? You don’t have to look too far. Faced with slackening credit demand from the corporate sector, banks are pushing retail loans. Calls offering upgrades of credit cards, pre-approved loans and unsolicited cheques one can deposit in his/her account and treat these as a personal loan are doing the rounds again.
Since the Diwali season, banks started reducing interest rates and waiving or lowering processing fees on secured products such as home loans. With the latest cut in interest rates, State Bank of India ( SBI) continues to offer the lowest rate on home loans. Now, the interest on an SBI home loan of up to Rs 30 lakh is 9.95 per cent; for loans of more than Rs 30 lakh, it is 10.1 per cent.
ICICI Bank and Axis Bank also have innovative offers on home loans. ICICI Bank offers one per cent cash back on every equated monthly instalment ( EMI) for the entire tenure of the loan. Axis Bank has the ‘Happy Ending Home Loan’ scheme, which waives the last 12 EMIs, provided the initial loan period is 20 years and the borrower has made repayments for at least 15 years.
Many banks have also extended discounts announced during the Diwali season. Some also have innovative offers on unsecured products such as credit cards and personal loans. HDFC Bank, for instance, offers a personal loan approval in two minutes in case the application is online and the loan amount is less than Rs 7.5 lakh., Axis Bank, says banks have been focusing on the retail segment, especially in the last two years. As part of its retail bouquet, Axis Bank is offering personal loans at special rates for government employees and defence personnel. Small banks, too, have been quick to jump on the retail bandwagon. Federal Bank, which recorded 25 per cent growth in its retail segment in the December quarter, is focusing on small and medium enterprises and the retail segment, even as it cuts corporate exposure, both in loans and deposits, says D Sampath, head (retail). The bank has been growing its gold loan and automobile loan portfolios. After the repo rate cut by the Reserve Bank of India, it was one of the first to cut rates on automobile loans. The bank is offering automobile loans at a flat 10.45 per cent (earlier it offered these at 11.2-11.7 per cent, depending on the tenure). It has also reduced the turnaround time for approval of automobile loans.
Non-banking financial company Bajaj Finserv offers online approval of personal loans to premium salaried professionals. For loans of up to Rs 15 lakh, the company promises approval in five minutes and disbursal within 72 hours. The company’s personal loan segment was growing at 20 per cent a year, said a note by Bajaj Finserv. In the case of personal loan offers that seem too good to be true, one must check if the rate being quoted is on a monthly reducing balance or a fixed balance, says Aadhil Shetty of Bankbaazar.com. If it is on a fixed balance, the rate might be much higher in the long run. Borrowers must also ensure the processing fee is not too high for such products.
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