Personal Loan for Self-employed – Highlights
|Interest Rate||10.25% – 24% p.a.|
|Loan Amount||From Rs. 50,000 to Rs. 40 lakh|
|Repayment Tenure||From 12 months to 60 months|
|Loan Processing Time||From 1-5 working days|
|Processing Fee||From 1% to 5% of the sanctioned loan amount|
Note: The above-mentioned interest rates, fees and charges may change and shall depend on the sole discretion of the banks/NBFCs.
Personal Loan Interest Rates for Self Employed
Starting from a minimum of 10.25% p.a., personal loan interest rates for self-employed professionals and self employed non-professionals may vary from individual to individual depending upon his/her credit score, loan amount, age, repayment ability, etc.
Comparison of Personal Loan Interest Rates Offered by Banks/NBFCs
|Banks/NBFCs||Interest Rates (per annum)|
|HDFC Bank||10.25% – 21.00%||Apply Now|
|SBI||9.60% – 13.85%||Apply Now|
|ICICI Bank||10.25% onwards||Apply Now|
|Axis Bank||10.25% onwards||Apply Now|
|Kotak Mahindra Bank||10.75% onwards||Apply Now|
|IndusInd Bank||10.49% onwards||Apply Now|
|IDFC First Bank||10.49% – 23.00%||Apply Now|
|Bajaj Finserv||13.00% onwards||Apply Now|
|Tata Capital||10.99% onwards||Apply Now|
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Eligibility Criteria for Personal Loan for Self-employed Individuals
- You should be a self-employed professional/non-professional
- You should be at least 21 years old
- Minimum credit score should be 750 or above
- Your annual income should match the eligibility criteria set by the bank
- Your business should be running for at least 2 years
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Documents Required for Loan Application
- Duly filled application form with passport-sized photographs
- ID Proof: Aadhaar Card, PAN Card, Voter ID Card, Driving License, Passport, etc.
- Address Proof: Ration Card, Utility Bills (Electricity Bill, Phone Bill, etc.), PAN Card, Aadhaar Card, Voter ID Card, etc.
- Business Proof: Proof of Business Existence, Certificate of Incorporation, Certificate of Registration with Appropriate Registration Body
- Income Proof: ITR of Past 2 years, Certified Profit and Loss Statement
- Any other document required by the bank
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Factors Affecting Personal Loan Interest Rates
- Credit score: Before approving a personal loan, lenders check the applicant’s credit score to evaluate his creditworthiness. A good credit score (above 750) indicates that you have been disciplined with your repayments and the lenders do not hesitate to offer you a lower interest rate
- Tenure of business: If your business is running in profit for at least 2 years, you get a personal loan at a low-interest rate due to stability in business
- Relationship with the bank: If you already have a current or savings account with the bank or you have an existing loan that you have been repaying regularly, you may get a personal loan with a lower interest rate
Q. I have never filed Income Tax Return. Can I apply for a personal loan?
ITR works as income proof for self-employed professionals and self-employed non-professionals. Thus, if you have not filed ITR, you might not be eligible for a personal loan from a leading bank. However, you can try contacting NBFCs, which might offer you a personal loan without asking for income proof.
Q. I was working with an MNC 8 months ago and have just started my own business. Can I avail myself an instant personal loan for the self-employed?
Most lenders prefer giving a personal loan to self-employed individuals who have businesses running in profit for at least 2 years. However, a few NBFCs may offer personal loans even if your business is completely new.
Q. What happens if I miss an EMI?
If you miss an EMI, you would not only have to pay a late payment fee but your credit score might also decrease.
Q. Is it possible to prepay/foreclose my personal loan?
Most lenders allow you to foreclose personal loans only after paying 6-12 regular EMIs. However, lenders offering personal loans at floating rates may not have such restrictions.
Q. Do I have to pay a processing fee to process my loan application?
Yes, all lenders ask for processing fees that usually start from 1% of the sanctioned loan amount plus GST. This processing fee is non-refundable and usually varies from lender to lender.
Q. How can I apply for a personal loan for self-employed offline?
To apply for a personal loan for self-employed offline, you can visit the nearest branch of your chosen lender, leave an online query with their loan department or call up the prospective lender’s customer care department.
Q. Can I use a personal loan for self-employed for use in business purposes?
Yes, most banks allow you to use a personal loan for both personal as well as business purposes. There is currently no restriction on the end-use of a personal loan for self-employed, hence you can fund various expenses including home renovation, purchasing equipment/gadgets, vacation, wedding, etc.
Q. When will my loan get disbursed?
Once your loan application is approved, the amount gets disbursed to your account within 1 to 5 working days. However, a shorter or longer time period from approval to disbursal may be applicable depending on key factors such as loan amount sanctioned, an individual’s credit profile, etc. Many lenders also offer pre-approved instant personal loans to select customers having good credit profile
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