Sainsbury's Bank cuts loan rates for limited time

You can get lower rates - and rewards to boot - from Sainsbury's Bank until 18th November.

Sainsbury's Bank has cut the interest rates on its personal loans, some of which will enjoy lower rates for just a short period.

Sainsbury's offers both standard personal loans and Reward personal loans. The cuts to the Reward personal loans are only available until 18th November, so you'll need to move quickly to take advantage. 

Reward personal loans include the bonus of 5,000 Nectar points and entitle the loan holder to double Nectar points when shopping at Sainsbury's for two years. However, they come with slightly higher interest rates.

[SPOTLIGHT]Let's take a look at how the rates have been cut, and how they compare.

Small personal loans

On the standard loans,if you borrow between £5,000 and £7,500 over three years the representative APR has reduced from 6.8% to 6.3%, while loans over a four- and five-year term the rate has fallen from 6.9% to 6.4%.

With small Reward personal loans, the representative APR has fallen from 7.7% to 6.4%, while over a longer term the rate has been cut from 7.8% to 6.5%.

Here's how the best deals line up for a £5,000 loan paid off over 60 months.

So Sainsbury's boasts two of the top five small loans. However, it will still cost you at least £10 more with Sainsbury's than if you go with peer-to-peer lender Zopa.

Medium-sized loans

Medium-sized loans cover amounts from £7,500 to £15,000. Only the Rewards personal loans of this size are getting a price cut, with the representative APR for a three-year term falling from 5.3% to 5.1%, while over a five-year term the rate is dropping from 5.5% to 5.2%.

Here's how the top lenders shape up for a £10,000 loan over a five-year term:

*Existing customers only

As you can see, despite Sainsbury's rate cuts, it's still a fair way off the cheapest loans.

Large loans

For Sainsbury's large standard loans of £15,000 to £25,000 over three years, the rate has dropped from 6.8% to 6.7%, while over longer terms you'll get a representative APR of 6.8%, down from 6.9%. 

Meanwhile with Reward personal loans under three years, the rate has dropped from 7.1% to 6.8% while over a longer term the rate has fallen from 7.2% to 6.9%.

Here's how the best buys for a £20,000 loan look:

It's with these large personal loans that the Sainsbury's rate cuts have made the biggest difference, as it now shares top spot with Yorkshire and Clydesdale Banks. It also has the next best option with the Reward loan.

Would you pay a higher rate on your personal loan in order to bag double Nectar points for two years? Let us know your thoughts via the comment box below.

This article has been updated from an earlier version

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