Are there any processing fees and other charges for personal loans?

Yes, personal loans often come with a few extra costs beyond interest, including processing charges. Some are charged right at the start, others only if you miss a step later.

• Processing fee: Lenders usually take up to 5% of the loan amount before disbursing the loan. You’ll notice the credited amount is a little less — that’s the fee gone in advance.
• GST: Don’t forget the tax on top of the fee. Many people realise only when the statement shows a few hundred rupees extra.
• Prepayment charge: If you plan to close the loan early, the lender may charge up to 4% on the remaining balance. A few lenders drop it after a year or two, so check the fine print.
• Late payment penalty: Miss an EMI and you’ll see an extra entry — a small penalty plus interest for those days.
• Bounce charge: If the account doesn’t have enough balance on the debit date, a flat bounce fee applies.

Always ask the branch or agent to show these on paper before applying for the loan.