SBI Kavach — Collateral-Free Personal Loan for Covid Treatment Expenses

SBIWe had written about COVID-19 Personal Loan from Public Sector Banks earlier. These loans were not necessarily meant for covid medical expenses. Now, there’s some good news for all SBI customers (including salaried, non-salaried and pensioners). SBI is offering Kavach personal loans to its customers who are facing the cash crunch during this pandemic specifically for Covid-19 related medical expenses.


It is offered exclusively to meet the expenses of Covid treatment of self or family members. Those who tested positive for Covid after 1st April 2021 can avail this loan. Reimbursement of expenses already incurred is also available under this scheme.

Interest and Tenure

The rate of interest is fixed at 8.5% p.a. It is comparatively lower as the interest on other personal loans offered by SBI ranges from 9.6% to 13%. Moreover, there are no processing fees or any other charges.

The loan tenure is 60 months but it has a 3 months moratorium period. It means the borrower has to pay back the loan in 57 instalments, which includes the interest charged for the moratorium period. EMI payment will be via a Standing Instruction (SI) on the customer’s SBI account.

The best thing about this loan is that there are no prepayment penalties or foreclosure charges. So, those SBI customers who have neither medical insurance nor emergency fund can make use of this loan to meet their covid related medical expenses. This collateral free personal loan is available even if you have any other existing loans (including another personal loan) with SBI.

Minimum and Maximum Amount

The minimum a borrower can avail is Rs 25000 while maximum amount is 5 lakhs. The loan amount depends on the borrower’s eligibility such as CIBIL score and repayment capacity. To avail the loan, the SBI customers can approach any nearest branch of the bank. Alternatively they can also use the YONO app and the loan will be sanctioned instantaneously. The amount will be credited to the customer’s salary/pension/SB account with SBI.

Bottom Line

Borrowing just because of it’s easy availability is definitely not recommended. But when covid strikes, there could be a lot of mental as well as financial stress. In such a scenario, collateral-free loan with comparatively low interest and that too without any charges or prepayment/foreclosure penalties is a boon.


SBI Kavach Personal Loan page

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