Overdraft Personal Loan

A 10-lakh personal loan is an appealing credit option. As many banks are presently offering digital applications, you can apply and secure the necessary funds without visiting bank branches. Moreover, there’s no need to pledge any collateral. Moreover, most banks nowadays ensure that eligible applicants can expect fund disbursement within a day or two, further enriching the overall appeal of this borrower-friendly personal finance. It is ultimately recognised as a multi-purpose personal loan. I.e., you are allowed to apply any of your personal needs, and banks are typically ready to sanction your loan application in a jiffy. Let's scroll down to know more about this 10 lakh loan.

Why Need a 10 Lakh Personal Loan?

There could be many reasons why someone would need a 10 lakh personal loan. However, the following are some of the popular reasons people find ideal in applying for a 10 lakh personal loan online:

  • To renovate or expand your home.
  • To consolidate multiple debts into a single loan.
  • To cover medical emergencies or costly treatments.
  • To buy a new car or repair an existing one.
  • To finance a startup or upgrade an existing business.
  • To organise a wedding or cover other family-related expenses.
  • To pay for higher education or studies abroad.

10 Lakh Loan Interest Rates & Charges

A 10 lakh loan interest rate and other pertinent charges may vary based on your creditworthiness, chosen lender, loan tenure, etc. Some of the common information about a 10 lakh personal loan, including interest rates and other associated fees, is as follows:

Interest rate

This is a percentage of the principal amount that a lender charges for lending money. This interest is typically required to be paid as part of your EMIs, along with the principal amount. The average personal loan interest rate is approximately 11.50% per annum.

Processing fee

This is a one-time fee charged by the lender for processing the loan application. It covers the costs incurred by the bank in managing the paperwork, administration, and other pertinent expenses associated with your application. This fee is usually a percentage of the loan amount, typically ranging from 0.5% to 3%.

Prepayment or foreclosure fee

This is a fee charged by the lender if the borrower decides to repay the loan before the predetermined tenure ends. It is usually a percentage of the outstanding loan amount, ranging from 0% to 5%.

Late payment fee

This is a penalty charged by the lender for not paying the monthly instalment (EMI) of a personal loan on time. It can typically be a flat fee or a percentage of the unpaid EMI, ranging from 2% to 3% per annum.

Bounce or cheque return fee

This is a fee charged by the lender if the borrower’s cheque or ECS mandate gets bounced or returned due to insufficient funds or other reasons. It is usually a fixed amount, ranging from Rs. 200 to Rs. 500.

Comparison of Interest Rates Offered by Various Banks for Personal Loans of 10 Lakh List of Bank

Let’s examine the interest rates offered by the leading banks in India for a 10 Lakh personal loan online: 

Lenders Interest Rates  Processing Fees
HDFC Bank 10.50% p.a. onwards  Up to Rs 4999 + taxes
ICICI Bank 10.65% p.a. onwards  Up to 2.50% of the loan amount + taxes
Axis Bank 10.49% p.a. onwards  Up to 2.00% of the loan amount + taxes
SBI Bank 11.15% p.a. onwards  Up to 1.50% of the loan amount + taxes
Kotak Bank 10.99% p.a. onwards Up to 3.00% of the loan amount + taxes
Bajaj Finserv 11.00% p.a. onwards  Up to 3.93% of the loan amount + taxes 
Tata Capital  10.99% p.a. onwards up to 5.5% of the loan amount + taxes 
IndusInd Bank 10.49% p.a. onwards  Up to 3.00% of the loan amount + taxes
Standard Chartered 11.49% p.a. onwards  Up to 2.25% of the loan amount + taxes
IDBI Bank 10.15% p.a. onwards  1% of the loan amount + taxes 

Eligibility Criteria for 10 Lakh Personal Loan

Here are the common eligibility criteria for a Rs 10 Lakh loan: 

  • Age: You must be aged somewhere between 21 and 60 years.
  • Income: You must have a regular source of income, either as a salaried or self-employed individual.
  • Credit Score: You must have a positive credit history and a good CIBIL score of at least 650 or above.
  • Employment: You must have stable and continuous employment or business for at least 2 to 3 years.
  • Residence: You should be a resident of India and have a valid ID and address proof.

10 Lakh Personal Loan Repayment Tenures

A typical personal loan features a repayment tenure ranging from 12 to 60 months. However, some lenders are extending this term up to 84 months, allowing you to choose the tenure that best suits your convenience. It's important to note, though, that extending the tenure reduces the EMI amount but increases the total interest cost. To determine the most suitable tenure for your loan amount and interest rate, you can use a personal loan EMI calculator, which is available on the official website of Urban Money.

How to Get a 10 Lakh Personal Loan?

You can easily apply for an instant personal loan of ₹10 Lakhs by following the steps given below:

  • Visit the official website of Urban Money.
  • Click on the “Loan” option, and then select “Personal Loan” from the horizontal menu bar on the home screen.
  • You will be directed to a new page titled "Personal Loan," where you can find an array of lenders who offer 10 lakh personal loans. 
  • Choose the one that best suits your needs by clicking on the “Enquire Now” button.
  • A short digital form will appear on your screen. Here, you need to enter your name, mobile number, and city.
  • A 6-digit OTP will be sent to the entered mobile number.
  • Add the OTP and click the “Submit” button.
  • Within a day, our dedicated loan specialist will contact you regarding your chosen lender and guide you until the loan amount is credited to your bank account.

Documents Required for 10 Lakh Personal Loan

Following are the required documents you may need to submit along with a ₹10 Lakh loan application. 

  • Proof of Identity: PAN Card, Passport, Voter ID or Driving License.
  • Proof of Address: Recent copy of Utility Bills, Passport, Driving License or Aadhaar Card.
  • Proof of Income: Bank Statement for the last 6 months which shows your salary/income is credited. 
  • Proof of Employee: Salaried individuals should submit salary slips for the last 3 months, while self-employed individuals may provide documents demonstrating business continuity.
Make today the day you turn your 'someday' into reality. If you find yourself in need of a bit of extra cash beyond your current bank balance, and time constraints or a preference for avoiding regular fixed repayments like EMIs are a concern, worry no more. An overdraft loan facility could be the solution you're looking for. Whether it's for paying utility bills, managing medical emergencies, settling credit card dues, or handling any unforeseen expenses, an Insta overdraft facility allows you to access the required funds quickly. A bank overdraft facility is a service provided by banks to their account holders. Those who meet eligibility criteria can withdraw funds up to a specified limit, even if their current balance is zero. These limits may be influenced by your credit profile and past banking transactions. You can repay the amount at your convenience without being tied to a fixed EMI schedule. However, similar to other credit options, repaying the borrowed funds along with the applicable interest rate is a requirement. Keep scrolling to learn more.

Features and Benefits of Personal Loan Overdraft Facility

Here are the applicable features and benefits of an Instant overdraft facility personal loan:
  • Easy repayment options: You can pay the interest component monthly and the principal amount as per your cash flow.
  • Multiple withdrawals: You can withdraw and repay the loan amount multiple times within the sanctioned limit, without any extra charges.
  • Fixed or dropline limit: Depending on the lender, you can opt for a fixed limit that stays the same throughout the loan tenure, or a dropline limit that decreases gradually over time.
  • Simple documentation: The paperwork and verification process for an overdraft facility personal loan is minimal and hassle-free.

Interest Rate for Personal Loan Overdraft Comparison

The interest rate for personal loan overdrafts varies depending on the lender, the loan amount, the credit profile of the borrower, and other factors. In general, the interest rate for a personal loan overdraft is higher than the interest rate for a regular personal loan, as it offers more flexibility and convenience to the borrower. However, the borrower only pays interest on the amount they use, not the entire limit, which can help them save on interest costs. Here are the leading banks in India which offer Flexi Personal Loans:

Variable vs. Fixed Rates

Let’s examine the differences between variable rates and fixed rates regarding overdraft loans:
Variable Interest Rate Fixed Interest Rate
The interest rate changes over time based on an underlying benchmark or index. The interest rate stays the same throughout the loan term.
The initial interest rate is usually lower than the fixed rate, but it can increase or decrease later. The interest rate is usually higher than the variable rate, but it is predictable and stable.
The monthly payments can vary depending on the interest rate fluctuations. The monthly payments are fixed and easy to budget for as they remain unchanged. 
The total cost of borrowing can be lower or higher depending on the market conditions. The total cost of borrowing is known in advance and does not change.
Suitable for borrowers who can afford to take the risk or who plan to pay off the loan quickly. Suitable for borrowers who prefer certainty and security or who have a long loan term.

How Does the Overdraft Facility Loan Work?

The following outline describes the typical procedures for how an overdraft facility loan works:
  • You can apply for an overdraft facility loan from a lender that suits you best, and get approved for a certain limit based on your eligibility.
  • You can withdraw money from your loan account anytime you need, up to the sanctioned limit, using online banking, mobile app, cheque, or ATM.
  • You pay interest only on the amount you withdraw, not on the entire limit, at either a fixed or variable rate, depending on your chosen lender. The interest is calculated daily and is billed monthly to your loan account.
  • You can repay the loan amount in full or in part, whenever you have surplus funds, without any prepayment charges. You can also withdraw the repaid amount again, as long as it is within the limit and the loan tenure.

Eligibility Criteria

The eligibility criteria for an overdraft facility can vary based on the lender, account type, limit amount, and collateral provided. However, some of the common eligibility criteria for a bank instant OD facility are as follows:
  • The applicant must be an Indian citizen.
  • The applicant must be somewhere between 21 and 65 years old.
  • The applicant must have an existing bank account with their chosen lender.
  • You applicant must have a good credit score and repayment history.
  • The applicant must have a regular source of income that meets the criteria set by the lender.

Documents Required for a Flexi Personal Loan

To apply for a personal loan overdraft facility, you need to submit the following documents:
  • Proof of Identity:  PAN Card (mandatory), Aadhaar Card, Driving licence, or Passport.  
  • Proof of Address: Utility Bills, Voter ID Card, or Ration Card.
  • Proof of Income: Bank statement, salary slip, income tax return, etc.

Apply for Overdraft Facility

You can initiate your overdraft loan application through Urban Money's official website. Alternatively, you can contact our loan specialist by dialling 1800 208 3344, who will be happy to guide you until you secure the necessary funds. Our team of experts strives to provide you with a quick solution and help you make the entire process smoother. 

Let’s take a look at a list of features you can expect from an instant personal loan of ₹10 Lakhs:

  • Multi-purpose credit option
  • Collateral-free finance
  • Competitive interest rate
  • Flexible repayment term 
  • Online application process
  • Quick approval and disbursal

Key Points Lenders Consider While Offering Personal Loans of Rs 10 Lakh

Here are some of the major factors you may keep your mind while applying for ₹10 Lakh personal loan online:

  • Maintain a good credit score
  • Reduce your debt-to-income ratio
  • Present all your income sources
  • Affix co-applicant
  • Avoid multiple loan applications

Frequently Asked Questions (FAQs)

What is an Overdraft Personal loan?

An overdraft personal loan is a facility that banks offer to their account holders, allowing them to withdraw funds beyond their current balance up to a predetermined limit.

Is an Overdraft Personal loan a good Choice?

It largely depends on your financial requirements and situation. Hence, it is prudent to assess factors such as interest rates, terms, repayment capabilities, and other relevant factors before finalising any decision.

What is the Overdraft Personal loan limit?

The limit of an Overdraft Personal Loan is typically based on the applicants’ past transactions, credit profile, and income.

Urban Money