Why Do I Need an ICICI Personal Loan?


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ICICI personal loan helps you borrow up to INR 50 Lakh without having to submit any collateral such as fixed deposits, shares or other securities. Many may not have these and therefore, they can rely on an ICICI personal loan in times of financial crisis such as a medical emergency, wedding, child college fund, etc. For more information on the ICICI Personal Loan, read this page further.

Any Idea – How is the ICICI Personal Loan Amount Calculated?

As it is an unsecured loan, the bank will be estimating your loan eligibility on the following factors –

Monthly Income – ICICI Bank requires a minimum monthly income of INR 30,000 in case the applicant is salaried. So, if this criterion is met by the applicant, it means he/she can go further in the loan process. Using the documents such as the latest bank statement, salary slip, etc. the bank knows how much you earn. This helps the bank gauge how much you loan amount you can pay in instalments. 

Previous Record of Payments – A credit score helps ICICI Bank know your previous repayment record. How? This three-digit number ranging from 300 to 900 gives an idea of your repayment behaviour and creates an impression before ICICI Bank. And a score of 750 and above shows you have a good credit score and have managed your debts responsibly. This is an important piece of information for an ICICI personal loan. Because an individual with a good credit score can be trusted more for repayment compared to the one having a history of default payments. 

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Current Obligations – Do you have any ongoing credit card bills or loan EMIs? If yes, it could affect your eventual loan disbursal. Because a person with liabilities won’t be eligible to borrow much unless he/she earns substantially high 

What is the ICICI Bank Personal Loan Interest Rate?

The ICICI Bank personal loan interest rate starts from 10.50% per annum. To get the lowest rate on your loan amount, you need to have the following –

  • The flow of income – Your income should be regular to make the lender convinced about spotless EMI payments. 
  • Savings – Your savings must be more than your expenses because that is what matters in loan repayment.
  • Budget – Do changes to your budget and cut-off unnecessary expenses to make room for ICICI personal loan EMIs.

How & When to Repay the ICICI Personal Loan Interest?

The interest amount should be payable along with the principal constituent of your EMIs. Your interest liability will reduce with regular EMI payments. Check out the example below to know it better. 

Rajiv gets the ICICI personal loan of INR 5 Lakh and chooses a tenure of five years for its repayment. The applicable ICICI Bank personal loan interest rate is 11.05% per annum. Let’s see how much he’ll be paying yearly.

  • 1st Year – INR 79,290 Principal and INR 51,314 Interest
  • 2nd Year – INR 88,509 Principal and INR 42,095 Interest
  • 3rd Year – INR 98,800 Principal and INR 31,804 Interest
  • 4th Year – INR 1,10,288 Principal and INR 20,316 Interest
  • 5th Year – INR 1,23,210 Principal and INR 7,493 Interest
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From the above example, you can see how the interest is paid during the repayment period. You can cut down your interest liability by doing the prepayment, which means paying off the entire loan before the scheduled time. For prepayment, ICICI Bank will charge 5% on the principal outstanding balance along with the applicable GST.

Conclusion

You must have seen the utility of ICICI Personal loan for your needs. If you manage to strike an interest rate deal of 10.50% or just above, choosing this loan won’t be bad. Like we often say, apply only when you need. Adhere to it and everything will be fine.


Ashish jha

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