Can a Self-employed Person Get a Personal Loan?

Last Updated : July 14, 2020, 2:08 p.m.

Yes, a self-employed person can get a personal loan. The lender will approve the loan if you have a regular business income. The best part is that you don’t need to provide any collateral to get a personal loan. You can use the loan for your personal or business expenses, the choice is yours. The loan will come with an interest rate that will greatly dictate the pace of your repayment. Let’s check out the lenders offering personal loans to self-employed in India.

HDFC Bank

You can borrow a loan from HDFC Bank if you are self-employed professional or non-professional. Visit the bank website or branch to apply for a personal loan . HDFC Bank will sanction your loan based on the profit you will earn from the business or the annual income.

The bank will also check the credit history before disbursing a personal loan to self-employed. HDFC Bank personal loan for self-employed interest rate ranges from 10.75% - 14.50% per annum.You can pay the loan over tenures ranging from 12 to 60 months.

ICICI Bank

Self-employed individuals or doctors can apply for an ICICI personal loan . A personal loan to self-employed from ICICI Bank is contingent on meeting the following conditions.

• Your age should be 28 to 65 years
• Minimum turnover for the business should be INR 40 lakh or more if you are a non-professional.
• Self-employed professionals with a business turnover of INR 15 lakh can apply for the ICICI bank personal loan.
• Minimum profit in a financial year should be INR 2 lakh if you are a self-employed professional and INR 1 lakh if you are a self-employed non-professional.
• Your business should be stable for a minimum of 5 years
• To get the loan, you must have a 1-year of relation with ICICI Bank.

ICICI Bank offers a maximum loan amount up to INR 40 lakh at an attractive interest rate of 10.75% - 19.00% per annum. An ICICI Personal Loan to Self-employed is given for 12 to 60 months.

Bajaj Finserv

Bajaj Finserv disburses a personal loan to self-employed for upto INR 30 lakh. Your age should be 22 to 55 years and must have a business running for 3 years. And a high credit score of 750 and above will strengthen your loan request. Bajaj Finance charges an interest rate of 11.00% Onwards per annum. And you can later pay the borrowed loan in equated monthly installments of 12 to 60 months.

YES BANK

A personal loan to self-employed is granted by YES BANK. Self-employed needs to have a relationship of 1 year with the bank. Both self-employed professionals and non-professionals can borrow personal loans from YES BANK if they have a stable business. Depending on your monthly income and annual profit from the business, YES BANK disburses a personal loan to self-employed professionals and non-professionals. YES BANK charges an interest rate of 11.05% - 20.25% per annum while disbursing a personal loan to self-employed.

Where Can Self-employed Use Their Personal Loan Amount?

A personal loan to self-employed can be given for wedding, medical emergency, home renovation, etc. You can read all these in detail.

• To pay for a wedding: You could plan your wedding day with a personal loan as there are several functions in an Indian wedding. And it is hard for you to manage it within your budget. An unsecured loan ensures that you’ll meet your needs and is affordable to you at the same time. From catering to wedding planners and decorations, you can pay with an unsecured loan and repay it in equated monthly installments.
• To finance your home renovation: Taking care of the property is your responsibility and if you don’t do this it will trouble you later. So, if you think it is out of your budget to manage a home renovation, borrow an unsecured loan. Using it, you can get funds with an overdraft facility if you want, so that the amount is not overused and you will pay only for the used loan limit.
• To go on vacation: Getting a break from your daily routine is necessary to keep you rejuvenated and healthy. And if you are not financially ready for it, there is no need to worry about it. Apply for an unsecured loan and plan the desired vacation. Book flight tickets, reserved tables at the best restaurants for the best dining experience. And pay for the vacation in EMI without bothering your monthly expenses and income.
• To purchase the latest gadgets: Buy the product for which you have been waiting for so long using an unsecured loan. If you are a gadget geek and obsessed with the iPhone brand and its new products whether it is the Apple Watch, iPads, or iPhone11, you can buy it using an unsecured loan. You can easily apply for the loan if you are salaried or self-employed. The lender will provide you a loan if you have a regular source of income.
• To pay any medical expenses: Accidents, health illness, and any medical issue can arise anytime so you better be prepared for it. And if you aren’t, an unsecured loan can help you in this by providing you money for the treatment or operations. The loan is disbursed to your account quickly and then you can pay it to the hospital.

Documents to Apply for a Personal Loan

You need to submit the following documents while applying for a personal loan.

ID Proof:

• Aadhaar Card
• PAN Card
• Voter ID Card
• Passport
• Driving license

Address Proof:

• Electricity Bill
• Telephone Bill
• Rent Agreement ( for Tenant)
• Aadhaar Card
• Passport

Income Proof:

• ITR Report
• Balance sheet
• Turnover of the business
• Form 16
• TDS certificate

How to Apply for a Personal Loan?

You can apply for a personal loan either offline or online. If you are tech-savvy, you will like to apply for a loan on the website of the lender. Mention a few details and submit the online personal loan application form. The executive will come to pick documents from your office or residence. After that, the lender will verify the details submitted and approve only after successful authentication. In case you want to apply offline, you can do so at the branch. Visit the nearest branch of the lender with the required documents. Ask the concerned official to hand you the personal loan application form. Fill the form correctly and hand it over to the official. After that, the lender will take a few days to authenticate details. And once the authentication is done properly, the lender will disburse the personal loan amount to your account.