A Guide Of Personal Loan For The Salaried Employees

3 mn read

As per the recent International Labour Organization’s research, salaried employees and professionals make up almost 53% of the total employment worldwide. With the younger generations’ growing needs and aspirations, it’s inadvertent for them to look for a one-fit-all solution that gives liquidity to their pockets. Here is a guide for personal loan that you can go through:


Let’s start with understanding what a personal loan exactly is?

A personal loan is given by any banking or non-banking company as well as financial institutions, credit unions, online finance companies, etc. This loan is generally given without any collateral or security and hence is unsecured in nature.


There are several types of personal loans provided for various purposes like medical emergencies, wedding plans, home repairs and renovations, higher education, vacation, just to name a few. Each type of loan is offered on different terms so the person must consider all the necessary factors for making a wise decision.


Where can you get the loan from?

You can get a personal loan from any bank which is public, private, co-operative, rural, commercial, etc. NBFCs and private finance companies are also widely popular with their lucrative offers on personal loans.


Are you eligible for a personal loan and What the bank will look at before they pass your loan application?

Personal loan given to salaried employees depends upon various factors. A bank makes a thorough inspection of your application before sanctioning the amount. Though the criteria differ from bank to bank, you’ll be clear if you satisfy the following criteria:

  1. Age

Generally, the age limit for sanctioning personal loans to salary employees is 21 to 60 years.

  1. Salary

Income levels specified by banks differ significantly from each other; however, almost every bank requires a minimum income of Rs. 15,000 per month.

This criterion may also change if you’re an existing customer of the bank. For example, HDFC Bank offers personal loans to its salaried account holders earning a minimum of Rs. 25,000 per month while to non-account holders, the bar is set up high at a monthly income of Rs 50,000.

  1. Current Employment Tenure

Many banks see to it that you’ve been in employment for a while before applying for a loan. Sometimes, a salaried person may be asked to fulfil a certain quota of total years of work experience, while being employed with the current employer for a minimum of 1-2 years.

  1. Credit Score

If you’ve cleared above all eligibility tests, a good credit score almost guarantees the success of your getting a loan. It shows that you’re not a debt defaulter and can be trusted with the bank’s money.


How can you apply and when will you get the money?


Many banks nowadays provide the facility of applying online on the bank’s website directly. This is also extended to NetBanking or SMSBanking, at the ATMs of the bank, or you may visit the branch and fill up the application. Always keep your documents ready before you proceed to apply whether online or offline.


Which documents do you require to apply for personal loans?


Submit the application duly filled and signed. Key documents that can be asked for you to submit are:

  1. Identity proof like PAN, Aadhar, Voter’s ID, Driving License

  2. Address proof like a copy of rent agreement, recent utility bills, passport

  3. Recent Bank’s Statement or the bank’s Passbook

  4. Latest salary slips for the preceding 6 months

  5. Self-attested passport sized photographs


Now, what if you’re salary is low?

While banks follow the “higher the better” principle while sanctioning loans, don’t get dejected thinking you’re application will get rejected for having a low income.


Certain banks do provide personal loans to employees having salaries as low as monthly Rs. 10,000. However, the loan amount, tenure period, and interest will depend upon the salary accordingly.

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