How to Apply for a Personal Loan in India

6 of the Best Personal Loans in India

Personal loans have become a popular financial tool in India, offering quick access to funds for a variety of needs such as medical emergencies, home renovations, education or even travel. Unlike secured loans, personal loans are unsecured, meaning you don’t have to provide collateral like property or assets. However, finding the best personal loan option depends on several factors, including interest rates, loan tenure, processing fees and eligibility criteria. In this article, we will explore some of the best personal loans in India and discuss the application process and how to qualify for them.

1. HDFC Bank Personal Loan

HDFC Bank is one of the largest private sector banks in India and offers personal loans with competitive interest rates ranging from 10.50% to 21.00%. Loan amounts can go up to ₹40 lakhs, with flexible repayment tenures ranging from 12 to 60 months.

To qualify for an HDFC personal loan, individuals must meet certain eligibility criteria, such as being salaried or self-employed. Salaried individuals must have a minimum monthly income of ₹25,000, and self-employed professionals need to demonstrate a steady source of income. HDFC also offers pre-approved loans to existing customers with good credit history, making the approval process faster. Additionally, HDFC allows you to apply online or visit a branch for an in-person application.

2. SBI Personal Loan

State Bank of India (SBI) is a trusted government-owned bank, and it offers personal loans at interest rates ranging from 9.60% to 15.65%. SBI’s Xpress Credit Personal Loan is available for salaried individuals working with central or state government offices, public sector undertakings or large private sector companies. Loan amounts range from ₹25,000 to ₹20 lakhs, with repayment tenures of up to 72 months.

SBI’s personal loan eligibility depends on the applicant’s monthly income, job stability and credit score. The minimum income requirement for salaried individuals is ₹15,000 per month, making it an attractive option for lower-income applicants. Existing SBI customers may also receive a quick approval through the YONO app, which streamlines the process and offers pre-approved loan offers.

3. ICICI Bank Personal Loan

ICICI Bank is another leading private sector bank offering personal loans with flexible terms. ICICI offers loan amounts between ₹50,000 and ₹40 lakhs, with interest rates starting at 10.50% and going up to 19.00%. The bank provides quick disbursals—often within 3 to 4 hours—if the loan is pre-approved, and the repayment tenure can extend up to 60 months.

ICICI’s personal loan application process is simple, especially for salaried individuals. The bank requires applicants to be between 23 and 58 years of age, have a minimum monthly salary of ₹25,000, and possess a good credit score. For self-employed individuals, ICICI checks the business income and stability before approving the loan.

4. Axis Bank Personal Loan

Axis Bank offers personal loans ranging from ₹50,000 to ₹40 lakhs, with interest rates starting at 12.00%. The loan approval process is fast, and funds can be disbursed within 48 hours. The repayment tenure is flexible, ranging from 12 to 60 months, and the bank offers minimal documentation for existing customers, which speeds up the loan approval.

Axis Bank’s eligibility criteria require salaried individuals to have a minimum monthly income of ₹15,000. Applicants should be between 21 and 60 years of age, and their credit history is a key factor in loan approval. Axis Bank also allows customers to apply online, track their application status and receive disbursements digitally.

5. Bajaj Finserv Personal Loan

Bajaj Finserv offers personal loans with minimal paperwork and fast approval, typically within 24 hours. Loan amounts range from ₹30,000 to ₹25 lakhs, and interest rates vary from 12.99% to 15.00%. Bajaj Finserv stands out for its flexible repayment options, with tenures extending up to 84 months. The bank also provides a personal loan EMI calculator that allows borrowers to plan their repayment schedule.

To qualify for a personal loan from Bajaj Finserv, salaried individuals must be between 21 and 60 years old, with a minimum monthly salary of ₹25,000. The eligibility criteria for self-employed individuals vary depending on their profession and income. Bajaj Finserv also offers a pre-approved loan option for existing customers, which speeds up the application process.

6. Kotak Mahindra Bank Personal Loan

Kotak Mahindra Bank provides personal loans with competitive interest rates starting at 10.99%, and the loan amount can range from ₹50,000 to ₹20 lakhs. The bank offers a flexible repayment tenure of up to 60 months, with quick disbursals to the customer’s account.

Kotak Mahindra’s personal loan eligibility criteria are straightforward. Applicants must have a minimum monthly income of ₹20,000 and a stable job or business. The bank also checks the applicant’s credit score to determine their creditworthiness. Existing Kotak Mahindra customers can take advantage of pre-approved loan offers, which expedite the application and disbursal process.

Applying for a Personal Loan in India

The process for applying for a personal loan in India has become much more streamlined.. Most banks and financial institutions now allow customers to apply for personal loans online. The general steps include:

• Eligibility check: The first step is to check your eligibility, which can usually be done on the lender’s website. You'll need to provide details such as income, employment status and credit score.
• Application form: Once you qualify, fill out the online or in-branch application form. You will need to provide personal details such as name, address, employment information and income.
• Submit documents: Submit the necessary documents, such as proof of identity (Aadhaar card, PAN card), proof of income (salary slips, bank statements) and proof of residence (utility bills). Some lenders may also ask for your credit score.
• Loan approval: Once your documents are verified, the lender will approve your loan based on your eligibility and creditworthiness. If pre-approved, the process is faster.
• Disbursement: Upon approval, the loan amount is disbursed directly into your bank account. This can take anywhere from a few hours to a couple of days, depending on the lender.

How to Qualify for a Personal Loan

To qualify for a personal loan, lenders typically look at several key factors:

• Credit score: A good credit score (typically above 750) increases your chances of approval and ensures lower interest rates.
• Income: Your income should meet the lender’s minimum requirements. Salaried individuals generally need a monthly income of ₹15,000 to ₹25,000, while self-employed applicants need to show proof of a stable income.
• Employment history: Lenders prefer borrowers with a steady job or business, typically requiring a minimum of two to three years of work experience or business operation.
• Debt-to-income ratio: Lenders may also evaluate your existing debt to ensure you can handle additional loan payments.

Overall, the best personal loan options in India depend on your specific needs, eligibility and financial situation. It’s important to compare interest rates, loan tenure and processing fees before deciding which loan to apply for. By understanding the application process and qualifying criteria, you can secure a loan that meets your financial needs and helps you achieve your goals.