Best Personal Loan Rates (UK and USA Compared)
Personal loans are still among the top choices for users who need fast money to cover various needs such as consolidating debt, making home improvements, or giving large sums to cover medical expenses or other purchases. But the price of a personal loan can differ quite a lot from where you live, your credit rating, which bank you choose, and how much you want to borrow.
Here is an in-depth comparison of the best personal loan rates in the UK and USA as of 2025.
Personal Loan Rates in the UK
Typical Best Rates
- For loans between £7,500 and £15,000, the minimum personal loan rates in the UK usually range from 5.8% to 6.0% APR and are offered by major high street banks and some online lenders.
- For smaller loans in the range of £1,000 to £5,000, the rates are a bit higher and usually sit around 6.9% to 10% APR.
- It is also possible that loans greater than £15,000 might be eligible for lower APR promotions by some providers.
Key Market Trends
- Clubcard and loyalty program members (e.g., supermarket or retail banks) often receive a few advantages in terms of rates compared with standard borrowers.
- The trend has been that rates went up over the last few years because the base interest rate was higher, so now on average, personal loan APRs are between 8% and 10% for a large number of applicants.
- The average interest on credit cards in the UK is very high (more than 30%), hence personal loans are a cheaper and more convenient way to manage the debt.
Personal Loan Rates in the USA
Typical Best Rates
- A borrower with a perfect credit score (FICO 740+) is perhaps the one who will be given the opportunity to avail a personal loan rate starting at 5.99% to 6.49% APR. In particular, the rate can be achieved from online lenders or from some banks that are offering a discount for automatic payments.
- The average bank rate for a 3-year unsecured loan is approximately 12% APR.
- Credit unions are generally more affordable and have an average rate of 10%–11% APR. Besides, they are limited to 18% APR by law.
- The online lenders are the most diverse group in which the rates vary widely from 6% for a prime borrower to more than 30% for a subprime borrower.
Key Market Trends
- According to the national average, the personal loan APR is between 12% and 13%, but those with bad credit scores get usually an offer of a loan with an APR of more than 20%.
- APR on credit cards in the U.S. is over 21% on average, so personal loans are still a cheaper way to consolidate the debt.
- In the U.S., origination fees can be 1%–10% of the loan amount, thus the cost of borrowing can increase by that much, so it is very wise to check the APR (including fees) rather than just the interest rate.
| Feature | United Kingdom | United States |
|---|---|---|
| Lowest Available APR | ~5.8% | ~5.99% |
| Average APR (Good Credit) | 6%–10% | 10%–13% |
| High Risk Borrower APR | 15%+ | 20%–36% |
| Best Lenders For | High street banks, retail banks, supermarket lenders | Online lenders, credit unions, select national banks |
| Extra Costs | Few fees, mainly interest | Origination fees up to 10% |