Self-Employed? Here's How to Conquer the Personal Loan Application Process

Being your own boss represents a special kind of freedom. However, when it comes to unexpected business expenses, self-employed people can face some challenges, particularly when taking out a personal loan.

Earlier, it was not easy to obtain an unsecured personal loan for self-employed people without fixed salaries. However, today, the situation is evolving for the better. Digital lending platforms are breaking barriers so that self-employed people can get personal loans and achieve their financial goals.

Read on to understand how to get a personal loan as a self-employed professional in India.

Understanding Instant Loan for Self-Employed Eligibility

The initial step is to get familiar with the common criteria for personal loans for self-employed. Here are some key factors to consider:

1. Age Requirement

   The age limit for a personal loan for self-employed can vary depending on the specific lender and loan product. It typically falls within the range of 21-60 years old.

2. Credit Score

   A good credit score demonstrates your financial responsibility and creditworthiness to lenders. It can significantly impact your loan interest rate. For digital lending platforms, a credit score of 700 or above is generally considered favourable. However, some lenders may cater to "new-to-credit users" with limited credit history by offering alternative assessment methods.

3. Minimum Business Operational Time

   Most lenders require your business to be operational for a minimum period, typically ranging from 2 to 3 years.

Hassle-Free Documentation for Online Applications

One of the noteworthy advantages of digital lending platforms for self-employed loans is the streamlined application process. Digital lending platforms often require fewer documents compared to traditional banks, making the process faster and less cumbersome. Here's what you are typically expected to submit:

• Proof of Identity

  Documents like an Aadhaar card or PAN card.

• Proof of Address

  Utility bills, rental agreements, etc.

• Business Proof

  Business registration documents or licenses.

• Income Proof

  Income Tax Returns (ITR) for the past 2-3 years and bank statements reflecting your business income..

Strengthening Your Application for Approval

While meeting the basic eligibility criteria for a personal loan for self-employed is crucial, there are some additional steps you can consider to improve your chances of loan approval: