Complete Guide

Personal Loan Complete Guide

Everything you need to know about personal loans in India

What is a Personal Loan?

A personal loan is an unsecured loan provided by banks and NBFCs that doesn't require collateral. You receive the loan amount upfront and repay it in equal monthly installments (EMIs) over a fixed tenure (12-60 months). Personal loans are quick to process and flexible in usage.

Types of Personal Loans

Salary-Based Loans

For salaried individuals with fixed income, easy approval

Self-Employed Loans

For business owners and freelancers with profit & loss statements

MSME/Business Loans

For small business owners, higher loan amount available

Home Improvement Loans

Specifically for home renovation and repair costs

Wedding Loans

Lower interest rates for wedding-related expenses

Education Loans

For higher education with government backing options

Personal Loan Eligibility Criteria

Age

Minimum 21 years, maximum 60-65 years at end of loan tenure

Employment

Salaried employee, self-employed, or business owner with 2+ years experience

Income

Minimum monthly income ₹15,000-25,000 (varies by lender)

CIBIL Score

Minimum 650-700 credit score required

Bank Account

Active bank account for salary/income credit

Residence

Indian citizen or NRI with Indian bank account

Documents Required for Personal Loan

Salaried Employees

  • PAN Card
  • Aadhar Card
  • Latest 3 months salary slips
  • Last 2 years IT returns
  • Bank statements (6 months)
  • Address proof

Self-Employed

  • PAN Card
  • Aadhar Card
  • Business registration
  • Last 2 years profit & loss
  • Last 2 years IT returns
  • Bank statements (12 months)

Personal Loan Interest Rates

HDFC Bank7-12% p.a.
ICICI Bank8-12.5% p.a.
SBI7-9.5% p.a.
Axis Bank8-11.5% p.a.
Bajaj Finserv10.99-15.99% p.a.
LendingKart12-27% p.a.

6-Step Personal Loan Application Process

1

Choose Lender

Compare rates, tenure, and features across banks

2

Check Eligibility

Verify you meet income and CIBIL score requirements

3

Submit Application

Apply online or visit branch with documents

4

Document Verification

Bank verifies documents (usually 2-3 days)

5

Credit Approval

Get approval notification via SMS/email

6

Disbursal

Loan amount credited within 24-48 hours

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