The new 5.9 per cent rate compares favourably with some of the larger banks on the market, with HSBC’s typical unsecured loan rate currently at 6.9 per cent and Barclays and Natwest both at 9.9 per cent.

Alliance and Leicester says the new lower rate could save customers over £800 when compared with a loan from one of the higher-charging larger institutions.

“By reducing our personal loan rate we are making borrowing even more affordable,” commented Claire Alvey, personal loans manager for Alliance and Leicester.

“[It] could provide people with the perfect opportunity to spring-clean their finances,” she added, reinforcing the fact that savings made as a result of the loan could total hundreds of pounds.

To read more about personal loans, click here.

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