Table of Contents

• What is Personal Loan Tenure
• What is the Minimum Tenure for Personal Loan?
• What is the Maximum Tenure Offered under Personal Loan?
• Short Tenure vs Long Tenure: Which One Should You Choose?
• How Tenure Affects Interest Rate and Loan Cost
• What are the Factors that Affect Personal Loan Tenure?
• Is it Possible to close Personal Loan before the Tenure?
• Final Verdict

What is Personal Loan Tenure?

• Personal loan tenure is the time frame over which you repay your loan to the lender. It starts from the disbursal date and ends with your final EMI payment. At Piramal Finance, tenure options range from 9 months to 60 months, providing borrowers with flexibility to choose based on their income and repayment comfort.
• A shorter tenure typically means higher monthly EMIs, but less total interest paid. A longer tenure lowers your EMI burden but increases the total cost of borrowing due to more interest accrued over time.

What is the Minimum Tenure for Personal Loan?

The personal loan minimum tenure offered by Piramal Finance is 9 months. This short-term option is ideal for individuals with stable income and a goal to repay quickly.

• Example:
  Loan Amount: ₹3,00,000
  Tenure: 9 months
  Interest Rate: 12.9% p.a.
  Monthly EMI ≈ ₹35,400
  Total Interest ≈ ₹18,500
• Though the EMI is on the higher side, borrowers pay far less in interest, making it cost-effective if affordability isn't an issue.

What is the Maximum Tenure Offered under Personal Loan?

The maximum tenure offered under personal loan is 60 months (5 years) at Piramal Finance. It suits borrowers who prefer lower EMIs and need more time to manage repayments without straining their monthly budget.

• Example:
• Loan Amount: ₹3,00,000
  Tenure: 60 months
  Interest Rate: 12.9% p.a.
  Monthly EMI ≈ ₹6,800
  Total Interest ≈ ₹1,08,000+
  While the monthly burden is easier, borrowers pay more interest over the years.

Short Tenure vs Long Tenure: Which One Should You Choose?

Your choice of tenure should align with your cash flow, job stability, existing financial responsibilities, and overall loan affordability.

Short Tenure vs Long Tenure Comparison

How Tenure Affects Interest Rate and Loan Cost

While the nominal interest rate may stay constant, your total loan cost changes with the tenure. The longer the term, the more instalments you pay, leading to higher cumulative interest.

Example Comparison (Loan: ₹5,00,000 at 12.9%):

• 12 months → EMI ≈ ₹44,733 → Total Interest ≈ ₹36,800
• 36 months → EMI ≈ ₹16,892 → Total Interest ≈ ₹1,08,000
• 60 months → EMI ≈ ₹11,380 → Total Interest ≈ ₹1,82,800

This makes tenure one of the most crucial factors in long-term loan planning.

What are the Factors that Affect Personal Loan Tenure?

While you can choose a preferred repayment period, the final tenure depends on multiple factors, such as:

• Age
• Income
• Employment Type
• Current Policies

Is it Possible to close Personal Loan before the Tenure?

Borrowers have the flexibility to pre-close their personal loans before the original tenure through prepayment or foreclosure, helping reduce interest costs and close the loan early.

Advantages of Early Closure

• Save on future interest payments
• Boost your credit score
• Free up EMI capacity

Example: By prepaying ₹50,000 in year 2 of a 5-year ₹5L loan, you can cut the loan term by 8–10 months and save over ₹25,000 in interest. You can also try our pre-payment calculator.

Final Verdict

A well-chosen tenure ensures you don’t compromise your monthly budget while keeping your total interest in check. Evaluate your income, expenses, future financial goals, and job stability before deciding.

Smart Borrowing Tips:

• Prefer short tenure if you can afford high EMIs
• Opt for long tenure for financial breathing room
• Consider part-prepayments to balance both worlds

With Piramal Finance, you can borrow ₹50,000 to ₹25,00,000 with tenures ranging from 9 to 60 months and competitive interest rates starting at 12.9%*.

Frequently asked questions