Union Bank Personal Loan Interest Rate


The Union Bank of India personal loan interest rate starts at 10.85% per annum for up to ₹50 Lakhs, making it one of the best options in the market. Borrowers can choose from flexible repayment tenures ranging from 12 to 60 months, with minimal processing fees and quick disbursal. These interest rates vary based on your income type, creditworthiness, and employer profile.

Read more to learn about the complete breakdown of Union Bank Personal Loan interest rates, fees, EMI estimates, and how credit score or repo rate changes impact your interest rates.


Union Bank personal loan interest rates for salaried individuals start from 11.25% p.a. and can go up to 13.95% based on risk grades. The final rate depends on your income, credit score, employer category, and whether you hold a salary account with Union Bank.

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Table of Contents:

Union Bank Personal Loan Interest Rates

Union Bank provides different slabs of personal loan interest rates based on borrower risk profiles and income sources. This is also dependent on the type of loan one opts for and the overall repayment capacity.

Although the current personal loan interest rate is between 11.25% and 12.95% for salaried individuals, it is between 13.85% and 14.95% for salaried individuals without an employer and the self-employed categories.

These personal loan interest rates are reviewed regularly as per internal risk policies and RBI guidelines.

Personal Loan Scheme Who is Eligible Interest Rate (ROI)
Union Personal Loan (Tie-up) Salaried with employer tie-up 12.85% – 12.95%
Union Personal Loan (Non-Tie-up) Salaried without employer tie-up 13.85% – 13.95%
Union Personal Loan (Non-Salaried) Self-employed individuals 14.85% – 14.95%
Union Professional Personal Loan Salaried & non-salaried professionals 11.25% – 12.50%
Union Ashiyana Personal Loan For housing-related personal needs 11.25% – 12.00%

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⁣Union Bank Personal Loan Details

Union Bank offers some of the best features for its personal loans with competitive interest rates, flexible repayment options, and minimal hassle. Here is a comprehensive list of things you should know:

Feature Details
Interest Rate 10.85% - 14.95%
Loan Amount Up to ₹50 Lakhs
Tenure 84 Months (maximum)
Processing Fee 1% of the loan amount + GST

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⁣Union Bank Personal Loan Fee & Charges

Before applying for a Union Bank personal loan, it’s important to understand the applicable processing fees & charges based on the type of loan.

Union Bank levies standard processing and incidental charges on personal loans. Understanding these fees helps you assess the total cost of borrowing. The processing fee for personal loans in Union Bank is as follows:

Personal Loan Scheme Processing Fee & Charges
Union Personal Loan (Tie-up) Up to 1% + GST (standard fee)
Union Personal Loan (Non-Tie-up) Up to 1% + GST, as per bank norms
Union Personal Loan (Non-Salaried) 1% + GST; slightly higher fees may apply
Union Professional Personal Loan 1% + GST; Standard processing fee
Union Ashiyana Personal Loan Applicable as per the scheme

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Note: All fees are subject to applicable GST.

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Comparison of Personal Loan Interest Rates

Before finalising a personal loan, it is best to compare Union Bank's rates with similar lenders to assess competitiveness.

Lender Interest Rate (p.a.) Processing Fee
Union Bank of India 11.25% – 14.95% Up to 1%
State Bank of India (SBI) 11.15% – 13.80% Up to 1.5%
Bank of Baroda 10.50% – 15.00% 1% – 2%
Punjab National Bank (PNB) 10.90% – 14.50% Up to 1.2%
Canara Bank 11.55% – 15.85% Up to 1.5%

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Union Bank is more favourable for pensioners and salaried individuals with government or PSU employment.

Union Bank Personal Loan starts at an interest rate of 10.85% p.a. for government employees, women professionals and pensioners, with flexible tenures and low processing fees. This makes Union Bank's personal loans one of the best options in the market for individuals.

⁣Union Bank Personal Loan EMI Calculator

₹
%
Monthly EMI ₹86
Principal Amount ₹1,000
Total Interest ₹32
Total Amount ₹1,032.00

Year Month Principal (A) Interest (B) EMI (A+B) Balance Loan Paid to Date (%)

The Union Bank personal loan interest rates can be calculated by using a personal loan EMI calculator, which can help you estimate monthly repayment before applying. Here is a typical interest rate chart for various amounts of loans across different tenures, using the standard lowest interest rate for a salaried individual, 11.25%, as the interest rate.

Loan Amount 1 Year 2 Years 3 Years 4 Years 5 Years
₹1 Lakh ₹8,847 ₹4,701 ₹3,312 ₹2,634 ₹2,218
₹2 Lakh ₹17,694 ₹9,402 ₹6,624 ₹5,268 ₹4,436
₹3 Lakh ₹26,541 ₹14,103 ₹9,936 ₹7,902 ₹6,654
₹4 Lakh ₹35,388 ₹18,804 ₹13,248 ₹10,536 ₹8,872
₹5 Lakh ₹44,235 ₹23,505 ₹16,560 ₹13,170 ₹11,090

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Disclaimer: These values are indicative and may vary based on exact terms and borrower risk category.

Using the Union Bank Personal loan EMI calculator, you can get a quick view of your monthly EMI and what total interest might look like.

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Factors Affecting Union Bank Personal Loan Interest Rate

Interest rates are influenced by personal and financial attributes of the borrower. There are several factors that can affect your Union Bank Personal Loan Interest Rate.

  • Credit score (CIBIL)
  • Employer type (Govt, PSU, Pvt)
  • Loan tenure
  • Monthly income
  • Banking relationship with Union Bank
  • Existing loans or EMIs

Impact of Credit Score on Union Bank Personal Loan Interest Rates

A credit score is a three-digit numerical representation of an individual’s creditworthiness. The score ranges from 300 to 900 and shows how reliable you are at repaying the loan.

The impact of credit score on the personal loan interest rate includes:

  • Lower interest rates
  • Pre-approved loan offers
  • Faster loan approval

Generally, a credit score of 700 and above is considered ideal. Below 700, the Indian Bank personal loan interest rates may be higher. For example,

Scheme CIC Score Effective ROI
Union Professional Personal – Salaried Tie-up 700 & above 11.25%
Below 700 11.50%
Union Professional Personal – Salaried Non-Tie-up 700 & above 11.75%
Below 700 12.00%
Union Professional Personal – Non-Salaried 700 & above 12.25%
Below 700 12.50%

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Impact of Repo Rate Cut on Union Bank Loan Interest Rate

A repo rate is the interest rate at which the RBI lends money to commercial banks.

The MCLR (Marginal Cost of Funds Based Lending Rate) is the minimum rate at which a bank can offer loans. It is calculated based on the bank’s own cost of funds and other factors. It is indirectly influenced by the repo rate.

The EBLR is the External Benchmark Lending Rate, which is set by Union Bank and is directly linked to the RBI Repo Rate.

The RBI repo rate indirectly affects Union Bank’s lending rates via its internal MCLR and external benchmark system.

Union Bank changes personal loan interest rates as they are calculated based on the RBI’s repo rate, which is most applicable to floating interest rates.

As of April 2025, the EBLR is 8.75%, and the MCLR for one year stands at 9.00%. Let's look at the impact of the repo rate on personal loan interest rates.

  • Lending is more affordable by traditional banks at a lower repo rate.
  • Indian banks offer more personal loans at reduced interest rates.
  • This influences the MCLR and EBLR at which a bank equates the total interest rate for individuals.

When the RBI reduces the repo rate, banks lower their MCLR. Union Bank links personal loans to its internal benchmark, or EBLR, so new borrowers may benefit if linked to floating rates. Fixed-rate borrowers remain unaffected.

For example, if a bank's MCLR is 9.00%, and they add a 2.25% margin for a personal loan, your final interest rate will be:

9.00% + 2.25% = 11.25% p.a.

This 11.25% p.a. becomes your Effective Rate of Interest (ROI) on the personal loan.

For further queries on the Union Bank of India Personal Loan, connect with the Union Bank Personal Loan Customer Care.

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Frequently Asked Questions

The Union Bank personal loan interest rate starts from 10.85% per annum and may go up to 14.95%, depending on the borrower's credit score, employment type, and relationship with the bank.

At an interest rate of 11.25% p.a., the estimated EMI for a ₹3 lakh personal loan over 5 years would be around ₹6,654 per month. The exact EMI will vary based on the final rate and tenure.

For a ₹2 lakh loan at 11.25% interest over 3 years, the EMI would be approximately ₹6,624 per month. Use Union Bank’s EMI calculator for a precise estimate.

Applicants with high and stable monthly income, strong credit scores (750+), and a low debt-to-income ratio may be eligible for up to ₹10 lakh. However, there is a preference that is often given to salaried government employees or professionals with salary accounts in the Union Bank.

Union Bank offers preferential interest rates, starting from 11.25% p.a., to individuals with salary accounts maintained at the bank.

For salaried employees, especially those employed in government or PSU sectors, interest rates typically range from 10.85% to 13.95% p.a., depending on the risk grade.

Yes, Union Bank may consider a revised rate for applicants with an excellent credit profile, long-standing banking relationship, or high repayment capacity. Negotiation is more effective when applied through the branch or with pre-approved offers.

A reduction in the RBI repo rate may lead to a decrease in MCLR or external benchmark rates, which could result in lower personal loan rates for floating-rate borrowers. Fixed-rate loans, however, remain unaffected in most cases.

Borrowers whose personal loans are linked to floating benchmark rates, such as EBLR or MCLR, are eligible for revised rates when the bank passes on repo rate cuts. New applicants also benefit if the lower rate applies at the time of loan sanction.

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