Can People with Low Income Take Personal Loan?

When it comes to crediting Unsecured Loans, banks and NBFCs primarily take into consideration Credit Score and Credit History of the borrower to assess their pre-eligibility for the Loan. However, if you are a first-time borrower, the eligibility criteria may differ a bit. In the latter case, as you would lack the credit history, your salary and income sources would become the most important factor for the lender.

It doesn’t imply that those who currently have low take-home salary (for they have just started out their career or are working part-time due to other life goals) stand low or no chance for Personal Loan approval. However, the process could vary a tad bit for the borrower.

It is a myth that you cannot raise credit in the early days of your career. For, if that had been the case, we would not have seen the slew of start-ups emerging in recent years. Let’s find out what are the real-time facts about availing a Personal Loan with low income.

Personal Loan: features and eligibility

First things first, understand the product Personal Loan. It is an unsecured loan, which requires no collateral to disburse the amount. Unlike Home Loans, there is a low documentation requirement. Thus, Applying for a Personal Loan online saves a lot of time and energy of the borrower.

Besides, Personal Loans entail easy approval and disbursal. These are often borrowed as urgent loans by different segments of consumers, including those with low income. There is no end-use limitation attached to this product.

The basic eligibility criteria involve age group between 18 to 65 years, a minimum monthly salary cap of Rs 15000 in non-metro cities and Rs 20000 in metro cities and overall repayment capacity for the Loan. Personal Loans are available to both salaried as well as self-employed individuals.

For salaried individuals, the work experience should be at least six months to a year, and for a self-employed individual, the tenure of the working company should be at least three years. A self-employed individual would have to show his ITR of the last three years, which is the income tax return on the earning of the company.

Documents required for salaried individuals are age proof, address proof, identity proof, fully-filled form with a photograph, PAN card, salary slips of the last three months, and bank statements for the same. For self-employed individuals, the requirement includes age proof, address proof, identity proof, fully-filled form with a photograph, PAN Card, Income Tax Return for the last three years and a CA approved audit sheet and Profit and Loss amount for the same period.

Borrowing with a low salary

With a comparatively low length of career, one may find it too pressing to prove the eligibility for a Personal Loan to the major banks. Herein you must know that, apart from main street banks and NBFCs, many new age money lending companies also extend aggressive credit to many of those who were ineligible to take loans before. You can borrow as low as Rs 10000 to as much as Rs 5 Lakh or Rs 10 Lakh from these lenders.

MoneyTap Personal Loan is one of the good choices for low salaried individuals. Apart from offering quick Loan at easy terms, this new age lender also provides striking benefits to its consumers: they lend customised loans; flexible repayment options; and instant access to credit account on the app.

You can use their online EMI calculator and make an informed decision. The application procedure is as simple as using a mobile app. After pre-approval of the Loan, a loan expert will help you comply with the final KYC and documentation collection formalities. As soon as the verification is completed, you can start using the money for any of your requirements.

The list of benefits goes further. You pay interest only on the amount you use and not the total amount approved. Once approved, you can use it in parts or the whole. It’s your decision. The app-based lenders like MoneyTapofferfinancial assistance to low salaried individuals who can enjoy the benefits of easy credit like other experienced professionals.

These Personal Loan services can be used for many needs. You can borrow as Marriage Loan, Travel Loan, Medical Loan, Education Loan, Used Car Loan, Laptop Loan, Two Wheeler Loan, Mobile Loan, Home Renovation Loan, Consumer Durable Loan, Debt Consolidation Loan, etc.

Final Words

However, instant loans from alternative lender entail higher interest rate. So you must carefully gauge your loan needs and repayment capacity before applying for a loan. The responsibility and risks of availing credit should be well assessed before getting into the loop of borrowing.