When an emergency hits you, the very first thing you do is to look for things that can be helpful. And when it comes to financial emergency, you look for money. To avoid financial stress, people often take personal loan. In the past, it was a hectic process to borrow personal loan. Multiple visits to the bank, lack of information about personal loan and high-interest rate sum up the problem people used to face while borrowing a personal loan.
With the arrival of many new banks and NBFCs, taking a personal loan became easy. Soon the digital age arrived, and since then, people have been borrowing personal loans online due to various factors.
Reasons to Avail Personal Loan Online
Personal Loan is an unsecured loan which is borrowed for many reasons. Compared to other type of loans, a personal loan doesn’t require any collateral or security deposit. Below, we have mentioned a few points on why you should consider applying for a personal loan online.
- Multipurpose Loan – You can avail a personal loan for multiple purposes. The lender won’t track the end-use of the sanctioned loan amount.
- Pocket-Friendly Interest Rate – The rate of interest on personal loan is very competitive. At the time of repayment, it will be easier for you to pay the installments.
- Less Documentation – You don’t have to carry bag-full of documents at the time of applying for a personal loan online.
- Instant Approval – When you apply personal loan online, you get approval in lightning speed. Unlike other loans, a personal loan is disbursed in the borrower’s bank account within a few days.
- No Collateral Required – As it is a type of unsecured loans, you won’t have to provide a guarantor or deposit any security at the time of borrowing a personal loan.
Additional Benefits
- Ease of access
- Easy to keep track of loan application
- Option to compare and choose
- No need of physical documents
- Fast approval and disbursal
Personal Loan Interest Rate
It is important to understand that the interest rate of personal loan isn’t constant. It varies from one financial institution to another. The maximum personal loan one can avail depends on his/her salary package, job stability, credit score, etc.
| S. No | Bank Name | Interest rate (p.a) | Loan Amount |
| 1 | Yes Bank | 10.75% – 16.99% | Rs.1 lac – Rs.25 lacs |
| 2 | ICICI Bank | 10.99%- 16.75% | Rs.50k – Rs.25 lacs |
| 3 | HDFC Bank | 11.25% – 20.00% | Rs.50k – Rs.40 lacs |
| 4 | Kotak Bank | 10.99% – 24.00% | Rs.1 lac – Rs.30 lacs |
| 5 | Tata Capital | 10.99%19.00% | Rs.75k – Rs.20 lacs |
| 6 | IndusInd Bank | 10.99% – 20.00% | Rs.1 lac – Rs.20 lacs |
| 7 | IDFC First Bank | 11.69% – 15.00% | Rs.1 lac – Rs.20 lacs |
| 8 | Bajaj FinServ | 10.99% – 16.00% | Rs.1 lac – Rs.20 lacs |
| 9 | IIFL | 12.99% – 20.00% | Rs.1 lac – Rs.20 lacs |
| 10 | SBI | 11% onwards | Up to Rs. 20 lacs |
Factors Affecting Your Personal Loan Interest Rate
- CIBIL score
- Total loan amount
- Status of the borrower’s organisation
- Relationship with the Bank
Usually, credit score of 650 or above gets a pass for personal loan. To avail low-interest rate on personal loan, keep your credit score above 750.
Personal Loan Eligibility Criteria
The eligibility criteria to avail a personal loan also varies from one lender to another. Some of the most common eligibility criteria of a personal loan has been mentioned below –
- Applicant must have a constant source of income. For that, he/she needs to be salaried or self-employed professional.
- He/she should have a good credit score.
- The age criteria are mostly common among many banks. It ranges from 21 to 65. For salaried professionals, the age criteria is 21-58.
- Applicant should have a stable employment history. He/she should be working in his/her current organisation for last 2 year.
- Applicant must have a minimum salary of Rs. 15,000 to Rs. 20,000.
Documents Required for Personal Loan
For Salaried Individuals
- Filled Loan Application Form with passport-sized photos
- Salary slips of last 3 months
- ID Proof
- Residence Proof
- Last 6 months Bank Statement
- Employment Proof
- Signature Proof
For Self-employed Professionals
- Filled Loan Application Form with passport-sized photos
- ID Proof
- Office Residence Proof
- Income Proof
- Last 6 months Bank Statement
- Signature Proof
- ITR Return
Steps to Follow When You Apply for Personal Loan Online
By following the steps mentioned below, you will successfully be able to apply for a Personal Loan Online.
Know If You’re Eligible – The first step is to know if you’re eligible. Due to lack of information about eligibility for personal loan in India, people often unsuccessfully apply for a personal loan online. Knowing the eligibility is important as the rejected loan application hurts your CIBIL score most.
Carefully Compare Interest Rates – Choose the best personal loan for you by carefully comparing the interest rates of various banks and NBFCs.
Apply Online – Once you’re done with the first 2 steps, apply for a personal loan online.