We may as well inform you that by 2025, the Reserve Bank of India (RBI) and the Central Government stood to bring in a multitude of rules concerning personal loans. The purpose of such rules is to provide a safe and transparent loan facility for the borrower. The new changes have altered the interest rates, eligibility criteria, and repayment method, thus providing the loan takers with far more benefits.
Big Change In Interest Rates
In the new RBI guidelines, banks and financial institutions are now to give primacy to the income of the borrower and their credit score while determining interest rates in personal loans. Those persons boasting of good credit (i.e.750+) will get loans at lower interest. Besides, fixed interest rate loans are being promoted over floating interest rates, so that borrowers are not burdened with interest risk in the future.
Relaxed Loan Eligibility But Stringent KYC
In the new rules, banks will have to assess the personal loan applicant’s income on the monthly basis over and above his expenses to ensure that defaulting on repayment becomes less likely. This KYC process is far more stringent now, making the Aadhaar, PAN and bank statement as well as income certificate mandatory. The RBI has laid down strict directives against accepting any counterfeit documents.
Prepayment Charge Removed But With Conditions
Many banks have, till date, levied prepayment charges for early repayment of personal loans. As per the new rules that came into existence in the year 2025, a borrower will not be charged prepayment fees if he repays the loan after the completion of 12 months. However, such charges may still be applicable if they repay the loan before 6 months.
New limit Of Loan Amount And Change In Tenure
As per the new rule, banks can now offer personal loans of up to Rs 5 lakh under quick approval procedures provided the borrower’s credit score is good. The tenure, on the other hand, has now been increased to 7 years, thus lightening the EMI burden.
Cold-Boost For Digital Loan Processing
The application and approval process of personal loan in 2025 has been made completely online. The customers can now apply online and get the loan through e-KYC, without having to physically visit the bank. This has sped up the process even further with being paperless.
Conclusion
These new 2025 personal loan rules will prove beneficial for all borrowers. Low-interest rates, long repayment periods, and digital processes have made getting a loan totally a piece of cake. On the other hand, strict KYC and income verification will put a lien on fake loan applicants. Go through the newly set rules before applying for a personal loan.
