How Can A Freelancer Avail A Personal Loan In India?

If a person who works for himself or herself has proof of income, borrowing will be easy. Before giving a loan, the lender checks the borrower’s required documentation and proof of income. So, a self-employed or freelancer can get the loan without any trouble if you have all documents in the same form they prefer and all the other required documents.

So, how can a freelancer take a personal loan In India? Piramal Finance in India understands that these people have their own business that is not an organization. They own the business by themselves. But many individuals consider that it might be hard for self-employed or a freelancer to get a personal loan because they don’t have a regular paycheque. This is not the case at all. A person who works for himself or herself can easily get a personal loan, like any regular employee. Continue to read about their eligibility criteria, documents required, interest rate and more. 

Eligibility Criteria for Personal Loan for freelancers in India

The eligibility varies from bank to bank, but here are the general criteria that must be fulfilled for a personal loan to be approved: 

• The person applying should live in India. 
• At the time of applying, the applicant must be at least 24 years old. The applicant must be at least 65 years old when the loan is paid off. 
• The applicant should generate at least the minimum amount of money they owe the lender. 
• At least three years’ worth of job experience in the same business. 
• The business should make at least Rs.1 Lakh a year.

How Much Interest Will be Charged on a Personal Loan for Freelancers in India

Different banks have different interest rates which usually range from 10.99% to 25%, depending on your status and the plans or policies you choose. To get a personal loan at around this interest rate, you must meet the criteria for eligibility. If you fit the bank’s needs and keep a good relationship with the bank, you may even be able to secure a better rate. Also, different lenders charge different interest rates for self-employed people based on their backgrounds. So, checking with the bank about the interest rate before getting a personal loan is essential.

*Interest Rates: Interest rates vary from bank to bank, so it’s important to look at several banks before you apply.

Documents Required

In general, here are the documents that the lender might want. The papers should be accurate and perfectly valid. 

• The form was filled out and signed. 
• Passport size photo.
• Proof of Identity: Passport, Voter ID Card, or PAN Card.
• Age proof: Birth certificate or passport. 
• Residence proof: a passport, a utility bill, or an allotment letter. 
• Proof of income: Recent tax return slip and computation of income, the past 2 years’ financial statements and profit and loss signed off by a CA. 
• Signature: Passport and Pan Card for signature verification. 
• Bank statement: Statements from the last three months or passbooks from the last six months. 

For most lenders, these papers must be shown for a personal loan for freelancers in India to be approved. The loan could be used for just about anything when there’s no need to give a reason. It works for everything, but it also has some issues. Compared to other loan products, this one has a high-interest rate. So you should be aware if you want to get one. Before you choose a lender, you should look around a bit. 

How to apply for a Personal Loan in India if you are a Freelancer or Self Employed Person

You have all the options for how to use the personal loan. You can choose to fill out the application either online or offline. The different ways to fill out the application are as follows: 

• Online Application: To apply for a loan online, you must go to the bank’s website and give them your personal details. You could also apply through internet banking by using your login info. 
• Visit the Nearest Branch: Go to the bank with all the vital paperwork, hand it out, and get the loan. 
• Over Phone Call: To get the loan, you can also contact the customer service staff directly. 

Difference between a Personal Loan in India from a Bank and an NBFC for a Freelancer

Many banks and NBFCs offer personal loans in India to self-employed people who are unmatched and flexible. But before you take out a loan, you need to know how the two lenders differ. The difference between these two types of lenders is that banks have strict policies, and some banks will give loans to people with good credit. On the other hand, NBFCs are more flexible about giving out personal loans but also have higher interest rates than banks.

Things to Look for in Freelancer Personal Loans in India from Different Banks

• Rate of Interest: Always compare the interest rates that different banks offer to meet your own needs. 
• EMI: The next thing you should remember is that different banks have different monthly EMIs. Compare how much each bank charges each month for almost the same loan. 
• Time Taken to Get Approved: Most loans can be approved in three to four business days. But you should find out how quickly a bank can resolve your loan request. 
• Turnaround Time: Review and compare how long it takes for a bank to process and pay out money. Check carefully because various banks have different times for disbursing money. 
• Loan Term: It’s vital to compare different banks’ terms. You can choose the duration of time, but first, you should compare. 

Benefits of Personal Loan for Freelancers in India

• Competitive interest rates.
• No collateral.
• Transparency. 
• Easy EMIs. 
• Flexible tenure periods. 
• The loan amount depends on how much the person can pay back. 
• The loan money can be spent on anything you want.

Conclusion

Almost all the banks and NBFCs in India offer personal loans to freelancers that are easy to get. Employees can easily get money to cover expenses like medical bills, marriage expenses, gadgets, higher education expenses for their children, home repairs, etc. You can also use a Bank Loan EMI calculator to plan your expenses over the whole period you have all the loans. Or if you want the best personal loan offers, visit Piramal Finance.