Non Resident Indians or NRIs can avail a personal loan from various top banks in India to meet various financial exigencies including emergency medical expenses, home renovation, debt consolidation, etc. These NRI Personal Loans can be either secured or unsecured and come with flexible repayment tenure of up to 60 months. The following sections discuss key details regarding personal loans in India for NRIs.
Features of NRI Loans
- Loan amount: NRI applicants can avail personal loans up to Rs. 10 lakh to meet various personal financial needs.
- Flexible repayment tenure: These unsecured personal loans usually come with a flexible repayment tenure ranging up to 60 months
- Attractive interest rates: NRI personal loan interest rates are competitive in nature and in line with other types of unsecured credit. However, the exact rate on offer may vary from lender to lender and is also dependent on the applicant’s profile.
- Easy application and quick processing: The minimal documentation requirement and hassle-free application process ensure quick processing and disbursal of these loans
- Flexible end-usage: NRI personal loans can be used to meet any personal financial requirements including medical expenses, debt consolidation, home renovation, etc.
Types of NRI Loans
Many leading banks provide personal loans for NRIs in India. These loans are broadly divided into two categories:
- Secured Personal Loans: These personal loans are provided against a collateral or security. Commonly accepted collateral by banks include bank fixed deposits including FCNR deposits and property owned by the applicant. Most of the private and public sector banks in India provide secured personal loans for NRIs with a close relative or family member acting as a co-applicant/guarantor for the loan.
- Unsecured Personal Loans: An unsecured personal loan is provided without any collateral or security. It is completely based on prospective borrower’s profile – income, current outstanding debt, credit score, etc. thus, involves a greater degree of risk for the lender.
Comparison of NRI Personal Loans Offered by Top Banks in India
The following table shows a comparison between the key features of NRI Personal Loans offered by leading lenders in the country:
|Particulars||ICICI Bank||South Indian Bank||HDFC Bank||Kotak Mahindra Bank|
|Interest Rate||Starting from 15.49%||Starting from 10.20% p.a.||Starting from 10.75%p.a.||Varies with the loan amount|
|Tenure||Up to 36 months||12 to 60 months||12 to 60 months||Up to 10 years|
|Loan amount||Up to Rs. 10 lakh||Up to Rs. 10 lakh||Up to 40 lakh||Up to 80% of the cost of home improvement|
|Processing Fee||Up to 2.25% of loan amount plus GST||2% of the loan amount||Up to 2.50% of the loan amount||As per loan agreement|
The following NRI personal loan eligibility criteria need to be fulfilled when applying for a NRI personal loan:
|Age||21 to 60 Years||21 to 68 Years|
|Minimum Total Work Experience||2 Years with at least 1 year in the current organisation||Minimum 2 years in current business|
|Co-applicant Required||Yes. Must be a close relative of the applicant such as father, spouse, etc.|
Note: The eligibility criteria mentioned above is generic in nature and the exact eligibility criteria that need to be met may vary from one lender to another. The eligibility criteria for a NRI personal loan may also vary based on the applicant’s profile including his/her CIBIL score, income, employment status, employer, country of residence, etc.
Documents Required to Apply for Loan
NRI applicants are generally required to submit the following documents to avail a personal loan:
- Photocopy of passport and Visa of NRI applicant
- Identity Proof (For both applicant & co-applicant)
- Address Proof (For both applicant & co-applicant)
- Income Proof:
-Both Indian and international bank account statement for last 6 months
– Salary certificate (in English) or salary slips for last 6 months
- Employment Proof:
– Appointment Letter
– HR’s email ID or official email ID
-Labour/ Identity card/CDC (for NRIs working in Middle East or employed in Merchant Navy )
- If the NRI applicant is present in India at the time of submitting the loan application, the Power of Attorney needs to be attested or notarized locally. In case, the applicant is outside India at the time of submission of loan request, then the Power of Attorney needs to be attested by Indian Consulate of NRI’s resident country.
- Passport size photographs
How to Apply for NRI Loans?
You can easily apply for a NRI Personal Loan using any of the following means given below:
- Branch Visit: You can visit the lender’s branch office in India.
- NRI Help Desk/ Customer Service Department: You can enquire about the availability of loans by contacting the lender’s customer service department or the NRI helpdesk.
Benefits of NRI Loans
Some of the benefits of availing a NRI personal loan in India are-
- Instant source of financing for immediate personal requirements
- NRI Loans in India can be availed by both salaried professionals and self-employed individuals
- Can be easily availed from most of the big banks and non-banking financial companies
- Simple process with minimal documentation required for personal loan
- Easy, hassle-free and instant processing to quicken the process
- Come with flexible end-usage and repayment tenure
Here are a few key aspects that you must keep in mind when applying for a NRI personal loan:
- Evaluate the complete cost of the loan. Charges including processing fee, late payment fee, etc. must also be considered besides interest, before opting for a particular NRI loan.
- To avail the best deal, compare different interest rates and charges online before you actually apply for a NRI personal loan. Additionally if you own assets in India such as property, bank fixed deposits or FCNR deposits, do check about secured NRI personal loans as these typically feature a lower rate of interest.
- The loan may be provided either in foreign currency or in Indian rupees depending upon the lender’s policy. Check the lender’s policies carefully to know how the loan amount will be disbursed after approval.
- It is good to have an idea of your credit score prior to applying for a NRI personal loan. A low credit score can lead to rejection of your loan application or an increase in the interest rate being charged by the lender.
- Lenders often require applicants to have a co-applicant – usually a close relative living in India, to avail a NRI personal loan. You might find it difficult to avail a loan, in case you have no relatives in India. It is good to have clear idea about the lender’s policy regarding co-applicant(s) before you apply for a personal loan.
- Evaluate your need and repayment ability before you apply for a NRI personal loan. Avoid borrowing simply because you are eligible to borrow a higher amount.
Q1. Can I avail a NRI personal loan to fund my wedding expenses?
NRI personal loans offer flexible end-usage and can be availed to deal with any personal financial requirement.
Q2. How will I get the loan amount?
Once the loan is approved, the loan amount is disbursed to the borrower’s NRE/NRO account. The loan amount is usually disbursed in Indian rupees. However, some lenders also provide these loans in foreign currency. Borrowers may check with the lender about the mode in which the loan amount will be disbursed.
Q3. Can I avail a NRI Personal Loan even if I already have an existing loan?
Yes, you can avail a NRI personal loan even if you already have an existing loan, provided you have a specific percentage of disposable income after paying all the monthly EMIs. However, these conditions may vary from one lender to another.
Q4. Who can be a co-applicant for a NRI personal loan?
Most banks only permit close relatives and family members to become co-applicants for a personal loan offered to NRIs. However, friends are not permitted to be co-applicants for these loans in India.
Q5. Can I apply for a NRI personal loan without visiting the lender’s branch office?
Most banks do offer applicants the option to apply for a personal loan online. However, NRIs must check the application process with the bank’s customer service department or NRI help desk to know details of any branch visit requirements when applying for these loans.