Union Bank of India has lowered interest rates on select retail loans, effective 18 December 2025.
The move makes it easier for borrowers to access Home Loans, Vehicle Loans, and Personal Loans at more affordable rates.
The bank is among the first in the sector to react to recent monetary easing.
Details of the Revised Interest Rates
Here’s a breakdown of the new rates:
Home Loans: Reduced by 30 basis points, now starting at 7.15% p.a. (previously 7.45% p.a.)
Vehicle Loans: Reduced by 40 basis points, now starting at 7.50% p.a. (previously 7.90% p.a.)
Personal Loans: Reduced by 160 basis points, now starting at 8.75% p.a. (previously 10.35% p.a.)
Additionally, Union Bank is offering an extra 0.10% concession on eligible Green Finance Home Loans and Vehicle Loans, making borrowing even cheaper for eco-friendly projects.
Why the Rate Cut?
The rate reduction comes in response to monetary easing by the Reserve Bank of India.
On 5 December 2025, the RBI cut the repo rate by 25 basis points to 5.25%, marking the fourth rate cut this year.
Cumulatively, rates have fallen 125 basis points in 2025.
The government has also eased GST norms for the automotive sector, further supporting borrowers looking to buy vehicles.
What This Means for Borrowers
With these new rates, homebuyers, vehicle purchasers, and personal loan customers can benefit from lower borrowing costs.
However, the revised rates are subject to customer eligibility, credit profile, and other terms and conditions.
Union Bank of India aims to make loans more affordable while maintaining prudent lending standards for all borrowers.