How do I compare interest rates across different lenders?

Comparing interest rates isn’t only about finding the lowest interest rate— it’s about seeing what’s behind it. Two loans with the same rate can still cost differently once you add the extras.

Here’s a simple way to check across banks or NBFCs:

• Note the type of rate: Fixed rates stay the same through the term; reducing-balance rates fall as you repay. The second one usually works out cheaper in the long run (depends on your financial situation).
• Look at the annual percentage cost: Ask for the effective rate after adding processing fees, insurance, or GST. That’s the real comparison figure.
• Check offers carefully: A 0.5% lower rate isn’t worth it if the lender adds a large upfront fee or insists on bundled products.
• Match the tenure: Compare lenders on the same loan amount and tenure, or the numbers won’t line up.

In practice, shortlist two or three lenders, input their details into an EMI calculator, and see which total payout feels comfortable — not just which rate looks smaller.