When you take out a personal loan in the Philippines with low interest rate, you can hit two birds with one stone. Not only can it fund whatever it is you need to buy or pay for, but you can pay off the loan in affordable monthly payments as well.
Majority of borrowers in the Philippines take the interest rate into account when applying for a loan. According to the latest Bangko Sentral ng Pilipinas (BSP) financial inclusion survey, the interest rate is one of the top three considerations for 37% of Filipino borrowers.[1] This is primarily why many Filipinos go for a low-interest personal loan.
The best personal loans in the Philippines are usually from government agencies and banks. Getting a personal loan with low-interest rate helps you save money, as it keeps the interest payments low over the loan's duration.
Monthly Add-On vs Effective Interest Rate: What's the Difference?
First things first: Let's clarify the differences between the two types of interest rates on personal loans in the Philippines.
Lenders typically advertise two types: the monthly add-on and effective interest rates. Also called the annual percentage rate (APR), the effective interest rate reflects the true interest you're paying on a loan.
On the other hand, the monthly add-on interest rate is calculated by combining the amount of the loan and the annual interest rate, then multiplied by the number of years you hope to repay the loan. This results in a more expensive monthly amortization cost for the borrower. Thus, when checking for different types of personal loans, try searching for a lower monthly add-on interest rate.
What Bank Has the Lowest Interest Rate for Personal Loans in the Philippines?
Wondering which bank is the best option for a personal loan? We've listed down some of the lowest interest personal loans in the Philippines not just from banks but also government agencies. Choose the best deal that fits your needs and budget.
1. SSS Salary Loan
- Effective interest rate: 10% per annum (based on diminishing principal balance)
- Loan amount: Up to ₱30,000
- Loan terms: Up to 24 months
- Processing duration: Two to three weeks
- Loan fees:
- Service fee of 1% of the total loan amount
- Late payment penalty of 1%
The SSS salary loan is a government loan with a low interest rate of 10% per year, meaning that the monthly payments will not fluctuate monthly. Qualified SSS members can borrow one month's or two months' worth of their monthly salary credit and repay the loan in 24 monthly installments.
Loan repayment is also convenient for employed borrowers, as their monthly amortization is automatically deducted from their salary. No wonder it's the Filipinos' top-of-mind choice for their short-term cash needs.
Another great feature of this low-interest personal loan is the Loan Restructuring Program (LRP). The LRP makes it easy for delinquent borrowers to settle their overdue SSS loans at a lower annual interest rate of 3% without having to pay the penalty fee. Also, the repayment term is flexible up to five years.
2. Pag-IBIG Multi-Purpose Loan
- Effective interest rate: 10.5% per annum
- Loan amount: Up to 80% of your regular Pag-IBIG savings
- Loan terms: Up to 24 months
- Processing duration: Two to three weeks
Another popular low-interest personal loan in the Philippines is the Pag-IBIG Multi-Purpose Loan. Sharing many similarities with the SSS salary loan, the Pag-IBIG loan offers a low fixed rate of 10.5% and allows monthly repayment through payroll deduction. The loan is payable in 24 monthly installments.
Qualified Pag-IBIG members can borrow 80% of their total accumulated value (TAV). The TAV is a sum of all monthly Pag-IBIG contributions, employers' share of contributions, and the total dividends earned.
3. HSBC Personal Loan
- Monthly add-on interest rate: As low as 0.65% for 24 months
- Effective interest rate: 14.29% for 24 months
- Loan amount: ₱30,000 to ₱500,000
- Loan terms: Six to 36 months
- Processing duration: Up to five working days
- Loan fees:
- Processing fee: ₱1,500
- Late payment fee: 36% per annum on overdue payment
- Documentary Stamp Tax: 0.75% of the drawn loan amount (deducted from loan proceeds; applies to loan amount of at least ₱250,000 or for business purposes)
Bank loan interest rates in the Philippines like what HSBC offers is also a good option. You can use this to fund your travel or education. Check our HSBC Personal Loan guide before you apply.
4. BPI Personal Loan
- Monthly add-on interest rate: 1.2%
- Annual contractual rate: 25.60%
- Loan amount: ₱20,000 to ₱2 million
- Loan terms: 12 to 36 months
- Processing duration: Five to seven working days
- Loan fees:
- Processing fee: ₱1,500 (one-time; deducted from loan proceeds)
- Documentary stamp tax: ₱1.50 per ₱200 of the loan amount (for BPI personal loans above ₱250,000 or for business purposes)
BPI also offers one of the lowest personal loan interest rates in the Philippines. It has an affordable option for Filipinos who need to borrow money through its low-interest personal loan starting at 25.60% annually. You can borrow an amount that's up to thrice your gross monthly income. The loan amount for BPI personal loan ranges from ₱20,000 to ₱2 million payable in 12, 18, 24, 30, or 36 months.
Here's your Easy Guide to Applying for a BPI Personal Loan if you're interested to get one.
5. CIMB Bank Personal Loan
- Monthly add-on interest rate: 1.12% to 1.95%
- Annual contractual rate: 24%, 30%, or 36%
- Loan amount: ₱30,000 to ₱1 million
- Loan terms: 12 to 60 months
- Processing duration: Loan application in just 10 minutes, approval in 24 hours, and disbursement in one to two banking days
- Loan fees:
- Documentary Stamp Tax: ₱1.50 per ₱200 of the loan amount
- Late payment fee: 5% of unpaid installment due or ₱300. whichever is higher
CIMB offers one of the lowest personal loan interest rates in the Philippines. And if you do everything on your phone, you'll be glad to know that CIMB offers an all-digital personal loan application. Just launch your CIMB app, tap "I need a personal loan" and "Apply now." Supply the required information and upload all your requirements. There will be a Virtual Verification process. If approved, you'll receive an email with the loan contract.
6. Citibank Personal Loan
- Monthly interest charge: 2.42%
- Annual contractual rate: 26.9%
- Loan amount: ₱100,000 to ₱2 million
- Loan terms: 12 to 60 months
- Processing duration: As fast as 24 hours
- Loan fees:
- Disbursement fee: ₱1,750 including stamp duty
- Closure handling fee: 4% of the unbilled principal component of the loan that is prepaid
- Late payment fee: ₱500 or 6% of the overdue amount, whichever is higher
Get the lowest personal loan rates with Citibank and have it approved within 24 hours. It has the longest repayment term—up to five years—in the Philippines.
But what many people don't know is that the Citi Personal Loan has low-interest rates. Check our article about Citi Personal Loan application to know more about this personal loan. You can borrow any amount from ₱20,000 to ₱2 million and repay it in 12, 24, 36, 48, or 60 months.
Moreover, you can apply for a Citi Personal Loan via Moneymax and receive a physical or a digital welcome gift upon loan disbursement. Depending on the disbursed loan amount, you can choose from Marshall Acton II Bluetooth Speaker (worth ₱17,490), JBL Flip 5 Portable Waterproof Speaker (worth ₱6,999), ₱5,000 GCash, or ₱10,000 GCash.
This personal loan promo runs until September 30, 2022. Hurry and apply through Moneymax now!
Note: This product is sold by Union Bank of the Philippines, using certain trademarks temporarily under license from Citigroup Inc. and related group entities.
7. RCBC Personal Loan
- Monthly add-on interest rate: 1.3%
- Loan amount: ₱50,000 to ₱1 million
- Loan terms: Six to 36 months
- Processing duration: Seven to 21 days
- Loan fees:
- Processing fee of ₱1,500 or 1% of the loan amount, whichever is higher
- Late payment fee of 5% per annum on any outstanding balance
Another loan with the lowest interest rate is from RCBC. It allows you to borrow up to ₱1 million with flexible terms of up to 36 months. The monthly add-on interest rate is 1.3%, and approval may take up to 21 days.
8. Maybank Personal Loan
- Monthly add-on interest rate: 1.3%
- Loan amount: ₱50,000 to ₱1 million
- Loan terms: 12 to 36 months
- Processing duration: Five to 10 working days
- Loan fees:
- Processing fee: ₱2,000 / ₱3,000
- Documentary stamp of ₱1.50 for every ₱200 if loan amount is over ₱250,000
- Credit Life Insurance (amount depends on age and loan maturity)
One of the best low interest loans in the Philippines is the Maybank Personal Loan, which offers a 1.3% fixed interest rate. You can also borrow up to ₱1 million, depending on your salary and bank approval.
9. CTBC Bank Personal Loan
- Monthly add-on interest rate: 1.39% to 1.79% across all loan terms
- Effective interest rates:
- 36-month term: 28.58% to 35.78%
- 24-month term: 29.33% to 36.98%
- 18-month term: 29.57% to 37.45%
- 12-month term: 29.48% to 37.54%
- Loan amount: ₱20,000 to ₱1 million
- Loan terms: 12 to 36 months
Also called Salary Stretch Loan (for individuals), CTBC Bank's personal loan is a multi-purpose loan that salaried employees and self-employed people can avail of for home improvement, education, balance transfer, business, travel, and more. Its interest rates are also among the lowest in the market, starting at only 1.39% for the monthly add-on rate and 29.48% for the effective interest rate.
10. PBCom Personal Loan
- Monthly interest rate: 1.42% for 12 months; 1.53% for 18 and 24 months; 1.63% for 36 months
- Effective interest rate: 29.48% to 32.40%
- Loan amount: ₱40,000 to ₱1 million
- Loan terms: 12 to 36 months
- Processing duration: Three to five working days
- Loan fees:
- Processing fee: ₱2,500
- Documentary Stamp Tax: ₱1.50 for every ₱200 of the loan amount
- Late payment fee: ₱500 or 3% of the installment amount due, whichever is higher
- Closure handling fee: ₱800 or 5% of the total outstanding balance, whichever is higher
11. EastWest Personal Loan
- Monthly add-on interest rate: 1.49% to 1.89%
- Annual contractual interest rate: Starts at 31.51% for 12 months
- Loan amount: ₱25,000 to ₱2 million
- Loan terms: 12 to 36 months
- Processing duration: Five to seven banking days
- Loan fees:
- Processing fee: ₱1,900
- Documentary Stamp Tax: ₱1.50 for every ₱200 if loan amount is over ₱250,000
- Late payment fee: ₱500 or 8% per month of outstanding balance, whichever is higher
EastWest Bank is another bank with the lowest interest rate on personal loan products at 1.89% monthly. You can borrow up to ₱2 million to finance your travel, emergency, and educational expenses.
12. CBS Easi-Funds Personal Loan
- Monthly interest rate: 1.55% to 1.75%
- Loan amount: ₱30,000 to ₱1 million
- Loan terms: 12 to 60 months
- Processing duration: Three to five working days
- Processing fee: ₱1,500
13. PSBank Flexi Personal Loan
- Monthly add-on interest rate: 1.75% for Term Loan; 2.5% monthly interest rate for Revolving Loan
- Effective interest rate:
- 42.88% for 24 months (Term Loan)
- 41.29% for 36 months (Term Loan)
- 34.49% for 12 months (Revolving Loan)
- Loan amount: ₱20,000 to ₱250,000
- Loan terms: 24 or 36 months (for fixed term loans)
- Processing duration: Five to nine working days
- Loan fees:
- Handling fee: ₱1,500 or 1% of the approved credit line, whichever is higher
- Credit line renewal fee: ₱1,500
- Collection fee: 15% to 35% of total outstanding amount in case of default (depending on delinquency age)
If you're shopping for lower interest loans, check out our article about PSBank Flexi Personal loan for more details. It’s collateral free, and it’s the only personal loan with a revolving credit line and fixed term. You get an ATM card as well. On top of that, you also receive rebates under their loan rebate program when you make advance or excess loan payments.
14. Security Bank Personal Loan
- Monthly add-on interest rate: 1.89%
- Annual percentage rate: Starts at 37.53%
- Loan amount: ₱200,001 to ₱2 million
- Loan terms: 12 to 36 months
- Processing duration: Within five banking days
- Loan fees:
- Processing fee: ₱2,000
- Notarial fee: ₱100 (for ₱100,000 loan amount and up)
- Pre-termination processing fee: ₱2,500
- Late payment fee: ₱500 or 3% of unpaid amortization, whichever is higher
One of the low-interest personal loans in the Philippines is the one from Security Bank. Loan amounts range from ₱200,001 to ₱2 million, payable in 12, 18, 24, or 36 months. Easily apply online through its website and get your loan approved within a week.
Check our guide on how to apply for a Security Bank personal loan.
At a Glance: 15 Personal Loans with Low Interest Rates in the Philippines
For your easy and quick reference, here's a summary table of the personal loan products with low interest rates.
How Will I Get Approved for a Low Interest Loan?
So you've found a personal loan in the Philippines with the lowest interest rate, but will your loan get approved? Just because a lender offers a personal loan with low interest doesn't mean everyone can actually qualify for it. This is true especially for banks that conduct credit checks to evaluate a borrower's ability to repay a loan. They look specifically at a loan applicant's credit score.
You have a great chance of getting a low-interest personal loan if your credit score is high. But if it's low, you might be approved with a high-interest rate or worse, get rejected for a personal loan.
That's why it's very important to check your credit score. If you know yours is good, you can negotiate with the bank for a lower interest rate. On the other hand, if your score is bad, you'll have the opportunity to improve it before you apply for a personal loan.
How to Get a Personal Loan with Low Interest Rate in the Philippines
A personal loan with a low interest rate is helpful to fund any emergency expenses or projects you have. It can also help you consolidate your debt or fund your child’s education. However, do your research and thoroughly evaluate your own finances before getting one.
Here are a few steps to consider when getting a personal loan at a low interest rate:
1. Crunch the Numbers
The last thing you or any lender want is for you to take out a loan you can’t afford. It's just a disaster in the making. However, you can avoid this by determining how much cash you need after loan charges are deducted.
Then, figure out how much you need to pay for monthly. Make sure you can afford this amount, and that it won’t strain your budget.
2. Compare Loan Products
If you want to get the lowest loan interest rate in the Philippines, don’t settle for the first offer you see. Check every nook and cranny of the internet to find the best deals in the market.
You can get the lowest interest personal loan through banks, government agencies, and other lending institutions. It’s still up to you where you would like to get it.
Consider the following factors when choosing where to loan money:
- Loan amount
- Loan term
- Monthly interest rate
- Loan fees
- Requirements
3. Prepare the Requirements
Once you’ve narrowed down your choices, check the bank or financial institution’s loan requirements. Some lenders require a minimum annual income to qualify for a personal loan. You may also have to fulfill document requirements proving your identity and source of income.
Then get your documents in order. This will fast-track your loan application and save you from the stress and hassle of going back and forth to the lender’s office just to submit all your documents.
4. Read the Fine Print
Make sure to read the terms and conditions of the personal loan. This piece of paper will give you important information about your personal loan, which can save you thousands of pesos in the long run. If you have any other concerns, ask your lender about it.
5. Apply for the Loan and Get Ready for Repayments
After choosing the best deal for your needs, it’s now time to apply for a personal loan. Again, get your documents in order and make sure you're eligible for the loan.
It’s also ideal to set a payment scheme for your loan. Adjust your budget to accommodate your monthly payment and ensure you’re not spending more than 30% of your monthly income just to cover any debts you have. This 30% rule is considered a good debt-to-income ratio.[2]
Final Thoughts
While banks and government agencies are known for their strict personal loan requirements, these lenders still cater to everyone's financial needs with their personal loans with low-interest offerings. As long as you practice financial discipline and maintain a good credit history, you can easily qualify for low-interest rates and eventually, save money on interest payments.
Sources:
- [1] 2019 BSP Financial Inclusion Survey
- [2] What Constitutes a Good Debt-to-Income (DTI) Ratio? (Investopedia, 2020)
Back to Blog 
