Personal loans are an unsecured form of credit that is popular to meet immediate requirements. It is multi-purpose in nature and therefore can be used for various purposes including wedding, home renovation, travel purposes and more. Moreover, there is no restriction for the amount borrowed and can be used for any purpose they want. In fact, a personal loan can help you build your credit faster when compared with other forms of credit. This is because of the risk it carries due to being unsecured.
All in all, a personal loan can offset any temporary financial crisis.
No collateral required
One of the benefits associated with an online personal loan is that it is unsecured in nature. This means you don’t need to pledge any collateral for your loan. Although this can be a reason for your interest rate, you can get a low-interest personal loan easily if you meet the eligibility requirements.
Minimal Documentation
In this age of digitisation, the process of verification and documentation has now become short. This is applicable for an instant personal loan as they are fast in disbursal and require minimum documents for approval.
Easy Approval
You can get personal loans that are quick and easy in approval. This is why it is the best bet in times of financial emergency. Moreover, the process has become digital; thus reducing time in the verification process.
Multipurpose in nature
A personal loan can be used for anything except for investment and illegal activities. Apart from that, it is multipurpose in nature and can be used for anything. Other forms of credit when taken are for a specific purpose and can be used only for the same. For example, a home loan is used for purchasing a house whereas a car loan is taken to buy a car. However, a personal loan can be taken to offset any immediate requirements.
Personal Loan Eligibility
Personal loans are provided by most of the banks/NBFCs but with different eligibility requirements. However, there are certain criteria that are common for all financial institutions. The eligibility criteria to get an online personal loan approval for salaried and self-employed individuals are:
| 1 | Age | 18/21 years - 60/65 years |
|---|---|---|
| 2 | Employment Type | 1. Salaried 2. Self-Employed professionals |
| 3 | Credit Score | 750 or above with a good credit history |
| 4 | Minimum Net Income (Monthly) | 15,000(non-metro cities) 20,000( metro cities) |
| 5 | Loan Amount | Up to ₹50 lacs depending on the credit profile |
| 6 | Work Experience | Salaried Employed at current company for at least 6/12 months |
| Self-Employed Business tenure of at least 3 years (continuous) ITR of last 3 years |
The common documents required for an online personal loan approval are given below:
For Salaried Individuals
1. Identity & Age Proof
2. Completely filled personal loan application with photograph
3. PAN Card
4. Residence proof - Passport driving licence, Voter ID, postpaid/landline bill, utility bills (electricity/water/gas)
5. Bank statements for the last 3 months(preferably your salary account)
6. Salary Slips of last 3 months
7. Form 16 or Income Tax Returns of last 3 years
For Self-Employed Individuals
1. Identity & Age Proof
2. Completely filled personal loan application with photograph
3. PAN Card
4. Residence proof - Passport driving licence, Voter ID, postpaid/landline bill, utility bills (electricity/water/gas)
5. Bank statements for the last 3 months(preferably your salary account)
6. Salary Slips of last 3 months
7. Last 3 years Income Tax Returns with computation of Income
8. Last 3 years CA Certified / Audited Balance Sheet and Profit & Loss Account
