Can I get a personal loan without salary slips?
Some lenders who provide a personal loan with no income proof or with no salary slips are HDFC Bank and Fullerton India.
What is a Personal loan?
A personal loan is lending of money by one or more individuals, organisations or entities to other entities, organisations or individuals without usually needing any security or collateral. There is some flexibility by the lender to use these funds. It is a type of unsecured loan that helps to meet current financial needs such as travelling or wedding costs.
Personal loans are generally short-term loans with a tenure ranging from 12 months to 60 months.
These loans have higher risk for the lender; therefore have higher interest rates, generally. However, there are several entities also offering attractive interest rates and flexible payment options. Usually they need 3 to 6 months of bank statements showing salary credits and latest salary slips. However, you can get a personal loan without salary slips. But, you need to submit some documents as proofs of steady income. Other documents that are accepted in place of this are Form 16, salary certificate or bank account statements. Some lenders also provide a personal loan without pay slips if you show a collateral or security. Getting such a loan also depends on every individual lender and the bank’s policies. Some may ask for a clean credit record, while some may ask for a Form 16 of last 2 to 3 years or an employer certificate and a talk with your employer, and so on.
Though the requirements from various lenders differ, these are some general guidelines for availing a personal loan by Finance Buddha:
|Eligible Criteria||Salaried||Self-Employed Professionals|
|City||Mumbai, Delhi NCR, Bangalore, Chennai, Kolkata, Hyderabad and Ahmedabad||All over India|
|Employment||Fulltime with at least 2 years of experience||At least 5 years of earning turnover|
|Documents Required||Bank Account Statement/ Latest Electricity Bill/ Latest Telephone Bill/ Latest Credit Card Bill/ Employers letter certifying current mailing address/Passport(Valid)- provided the passport address is present address mentioned in application form / Existing Registered House Lease/ Government I-card with photo||Bank Account Statement/ Latest Electricity Bill/ Latest Telephone Bill/ Latest Credit Card Bill/ Employers letter certifying current mailing address/Passport(Valid)|
Apart from these documents showing regular income, the minimum required documents are:
- A signed application form.
- Identity proof that can comprise of Aadhaar Card, Passport, Driving License, Voter ID or PAN card.
- Resident proof that can be through a Aadhaar Card, Passport, Driving License, Voter ID or Electricity/ Mobile bill/ bank statement/ Telephone/ (not older than 3 months).
Other factors determining a personal loan
- Age proof: Aadhaar Card, Passport, Driving License, Voter ID or PAN card. Age also forms an important determining factor to avail a personal loan. Usually, the age limit is between 22 to 62 years.
- Income: The income in most of these loans must be above the minimum wage limit. For some instant loans, there is a minimum income limit for salaried and self-employed people. This bracket varies across various financial institutions.
- Employment: Stability in your employment forms an important factor for getting a personal loan. For a salaried individual an employment record of 2 years and for a self-employed professional, a minimum of 5 years can help in getting instant personal loans.
- Credit history: A good credit rating always comes handy for getting any kind of loan. A credit report lists down all your financial record making it easier for the lender to verify your credentials.
- Employer: Having a link with an organisation with a good reputed and high turnover makes it easier to get a personal loan. A good employer with whom the loan applier is working helps in gauging the trust factor of the candidate.
Why someone gets salary without pay slip
Pay slips forms an important part when applying for personal loans, for change of job, etc. Some employees get salary without pay slips because the employers may want to evade labour law levies such as provident fund, medical insurance, gratuity, pension fund, and so on. Employers might also be not providing these to restrict the employees’ change of jobs or if paying salary out of black money. However, things are changing and a more formal structure if coming to take place when employing individuals.
What are the sources to get personal loan without pay slip? Personal loans can be availed from various sources. It is important to study the features and compare the kind of loans as per your objective and needs. Some important lenders offering these kind of loans are:
- Banks: There are several commercial as well as non-commercial banks offering the best rates in personal loans. And, most of them have various policies which allow individuals to produce bank statements or other income related documents in place of pay slips. Some top banks include Citibank, Yes Bank, Standard Chartered Bank, IndusInd Bank, and so on.
- NBFCs: Banks generally have stringent rules and practices. Though they are beginning to be more flexible, NBFCs come to immediate rescue having a little more flexibility in various aspects. This may ask for a higher interest rate though.
- Individual Entities: There are several Fintech companies as well as well-reputed individual organisations that are doing very well in providing almost all financial services similar to banks. Fullerton India is a good example under this category in providing personal loans without a pay slip.
- Individuals: This way of getting a loan might be more informal but this also ensures greater flexibility. Individuals include some formal money lenders or can be from your own networks that are ready to provide personal loans without pay slips.
What are the important factors to check before applying for a personal loan? Loan applicants must do a thorough research as per their requirement about which kind of loan they wish to apply for.
- Rate of Interest- This goes a long way and you need to first compare the interest rates by several lenders before applying for a personal loan.
- Monthly EMI- After being sure of what kind of rate you are willing to pay, check the monthly EMIs and compare the monthly EMIs for the same loan amount.
- Loan Tenure-Compare this before selecting a personal loan. Sometimes, a low interest rate might be spread across a long tenure that makes the total interest even more than many others.
- Time Taken for Approval- See the ways of processing of the bank. It usually takes two to three working days to get a loan approval. If it is taking long and is hectic, it’s time to switch lender.
- Prepayment Charges- Some lenders also charge a lot of prepayment fees. Check these to not run into huge credit losses.
- Disbursal Time- Similarly, do a check of the disbursal time along with the processing time and compare them with other lenders.
- Processing Fee- This might seem not-so-significant at the start but, remember to check this. Many lenders try to adjust lower interest rates with a high processing fee. This is generally within 1.5 to 2%.
A mention of top lenders who offer personal loan without pay slip
HDFC Bank: It provides personal loan without income proof if the customer is self-employed, has an operational current account with HDFC and has a business stability of 3-4 years of business stability.
|Interest Rate||11.25% – 21.50%|
|Loan Amount||Upto ₹15 Lakh|
|Tenure||Up to 5 Years|
|Processing Fees||0.99%-2.50% of the loan amount (minimum being ₹1,999)|
|Foreclosure Charges||Nil-Up to 4% on the principal outstanding + GST|
|Part- payment Charges||2%-4%|
|Repayment Mode||ECS, AD or PDC|
Fullerton India: Similarly, Fullerton India needs self-employed individuals to have a current account with it and show 3 years of ITR to get the personal loan.
It provides loans to borrowers within the age group of 21 and 58 years with a loan amount of minimum Rs. 1 Lakh to Rs. 20 Lakh and loan tenure as 12 to 48 months. It generally charges a rate of interest in the range of 17.25% to 33.00%.
The lowest EMI of Rs. 2,898 per lakh is available and the processing fees are up to 2.00%. Pre-closure of Fullerton India personal loan is allowed with 3 – 7% and is nil after 36 months and part payment charges are not allowed here. Other charges include late EMI bounce charges, EMI payment charges and loan cancellation charges.