A Comparative Study of HDFC and SBI Personal Loans

Life throws us curveballs anytime and whatever we do we cannot avoid being hit by it. We have to face every challenge that life throws at us and some of these challenges require finances. Having a considerable corpus at our disposable is impossible and this is where a Personal Loan comes into effect. A personal loan helps provide us finances which we can use to meet our personal or business related requirements. So whether you want to take a vacation, meet any emergent situation, regulate the working capital requirements of your business, plan your child’s marriage or whatever, a personal loan is there to take care of your financial needs. 

HDFC Bank and SBI are both leaders in the banking sector and Personal Loans from these two banks are loaded with good features. Let us review the comparative analysis of the two loans from the banks and see what they have to offer:

HDFC Bank Personal Loan

The loan comes in a single variant and the bank boasts of issuing the loan within 48 hours of application through minimal procedural requirements. The features of the loan are as follows:

• A maximum of Rs.15 lakhs can be availed as loan and it is to be paid back within 12 to 60 months.

• The loan availing process is easy and transparent without any hidden charges

• Women employees are given special privileges under the Personal Loan Diva category

• It is an unsecured loan which does not call for any security against the loan

• The loan provides an option to the borrower to avail a Personal Accident cover of Rs.8 lakhs and a Critical Illness cover of Rs.1 lakh by paying an additional amount

• The bank also provides borrowers the benefit of transferring their existing loans from other banks to HDFC bank at lower interest rates

• Prepayment of the loan is allowed only after 12 EMIs have been paid and prepayment attracts relevant charges

• Only salaried individuals or professionals earning a salary and aged 21 to 60 years can avail of this loan facility. Self-employed individuals cannot avail of this loan.

• The rate of interest ranges from 15.75% to 20% per annum.

SBI Personal Loan 

This loan comes in four different versions of Xpress Credit Loan, SBI Saral Pension Loan, SBI Pension Loan and Festival loans. Each loan has a specific usage and caters to the requirements of different set of individuals. The features of the loan are given below:

• The amount of loan granted varies among the different variants. The minimum amount available is Rs.5000 to Rs.25, 000 while the maximum amount is Rs.50, 000 to Rs.15 lakhs

• The repayment tenure, also varying, usually ranges from 6 months to 60 months

• Requirement of a security or a guarantor depends on the loan variant. While the first two variants require no security, a guarantor is required in case of loans to pensioners and in case of Festival Loans, a guarantor is required only if the eligibility check-of conditions are not met.

• Prepayment facility is available under all the variants of the loan without any prepayment charges irrespective of the period when the prepayment is made.

• The rate of interest is specific to each variant and the rate ranges from 132.35% to 18.20% across the variants 

• Specific loan variants can be availed by salaried employees, professionals whether salaried or self-employed, self-employed businessmen and even pensioners.

• The maximum age for availing the loan is 76 years under the SBI Pension Loan scheme.

The table below provides a better clarity on this comparative analysis.

Points of Difference	HDFC Personal Loan	SBI Personal Loan
Loan amount	Up to Rs.15 lakhs	Rs.5000 to Rs.15 lakhs
Repayment tenure	1 year to 5 years	6 months to 5 years
Interest rate	15.75% to 20%	Xpress Credit Loan – 13.35% to 15.35% SBI Saral Loan – 18.20% Loan to Pensioners – 13.35% Festival Loan – 16.45%
Prepayment facility	Allowed only after paying off 12 EMIs	Prepayment can be done anytime
Prepayment charges	Prepayment within 13-24 months – 4% of outstanding loan Prepayment within 25-36 months – 3% of the outstanding loan Prepayment after 36 months – 2% of the outstanding loan	No prepayment charges
Processing fee	Up to 2.5% of the loan sanctioned. The minimum is Rs.1000 and maximum is Rs.25, 000	Xpress Credit Loan – 1.01% of the loan amount SBI Saral Loan – 2.02% to 3.03% of the loan amount Loan to Pensioners – 0.51% with a minimum of Rs.250 Festival Loan – 1.10% of the loan amount
Eligibility of the borrower	Only salaried individuals can avail the loan	Salaried, self-employed, professionals and pensioners can avail of the loan
Other features	Special privileges for women borrowers Transparent and quick loan processing Additional facility of Personal Accident and Critical Illness Insurance cover Facility of transferring existing loans to HDFC Bank’s Personal Loan	Four loan variants to meet specific requirements Transparent loans with no hidden charges Pensioners aged up to 76 years can also avail of the loan