A personal loan is an unsecured loan provided by banks and Non-Banking Financial Companies (NBFCs). Since it requires no collateral or security, lenders evaluate your credit history, income, and employment stability to approve the loan.

Personal loans offer no end-use restriction. You can use the funds for medical emergencies, home renovations, debt consolidation, weddings, higher education, travel, or major purchases.

The maximum loan amount depends on your net monthly income, credit score, existing obligations, and employer profile. Banks typically sanction loans ranging from ₹25,000 to ₹40,000,000 (or local currency equivalent).

• Age: 21 to 60 years old.

• Employment: Salaried employees (at registered/reputed companies) or self-employed individuals/professionals.

• Minimum Monthly Income: Typically starts around ₹15,000 to ₹25,000/month (varies by lender and city).

• Credit Score: A CIBIL score of 750 or above significantly improves approval chances and yields lower interest rates.

• Work Experience: Minimum 1–2 years of total work experience, with at least 6 months at the current employer.

• Identity Proof: PAN Card, Aadhaar Card, Passport, or Voter ID.

• Address Proof: Utility bills, Aadhaar Card, Rent Agreement, or Passport.

• Income Proof:

  • Salaried: Last 3 months’ salary slips, Form 16, or ITR.

  • Self-Employed: Last 2–3 years’ ITR with computation of income, P&L statement, and Balance Sheet.

• Bank Statements: Last 3 to 6 months’ primary bank account statements.

Interest rates are generally fixed or floating, ranging from 10.50% to 24% per annum, depending on your credit profile, employer category, and lender policies.

Repayment tenures usually range from 12 months (1 year) to 60 months (5 years), with some lenders offering up to 72 or 84 months.

• Processing Fee: 0.5% to 3% of the loan amount (deducted before disbursement).

• Prepayment / Foreclosure Charges: Charges (0% to 5%) applicable if you pay off the loan before the end of the tenure. (Many floating-rate loans carry zero foreclosure penalty).

• Late Payment Charges: Penalties applied if an EMI payment deadline is missed.

Pre-approved personal loans for existing customers can be disbursed within minutes to hours. Standard applications with document verification usually take 24 to 48 hours.

When you apply, the lender performs a hard credit inquiry, which temporarily lowers your credit score by a few points. However, making timely EMI payments consistently will boost your score over time.

Repayment is done via Equated Monthly Installments (EMIs), automatically debited from your bank account through NACH/e-NACH mandates, auto-debit, or post-dated cheques.

Yes, most banks allow part-prepayment or full foreclosure after a lock-in period (typically after paying 1 to 6 EMIs). Check your lender’s lock-in terms and foreclosure charges before paying early.