Best Personal Loans in India

To qualify for a personal loan in India, salaried applicants typically need a minimum monthly income of ₹20,000–₹25,000, a CIBIL score of 700+, and stable employment of at least 6 months with current employer. Self-employed applicants need 2–3 years of business continuity and ITR proof.

Almost every Indian lender uses the reducing balance method: interest is charged each month on the outstanding principal, not the original loan amount. As you pay EMIs, principal reduces and so does the interest component — early EMIs are interest-heavy, later EMIs are principal-heavy.

Be cautious of small lenders that advertise "flat rate" — a flat 10% rate is roughly equivalent to a 18%–20% reducing-balance rate. Always ask for the APR (annualised percentage rate) or convert flat to reducing using a standard formula before comparing.

RBI's Fair Practices Code requires lenders to disclose effective interest rate in the sanction letter. Source: Reserve Bank of India.

Good reasons: Medical emergencies, debt consolidation (replacing 30%+ credit-card revolves with a 14% personal loan), home renovation under ₹10L (smaller than a top-up home loan), planned wedding or education expenses with a clear repayment runway.

Bad reasons: Funding a vacation, investing in markets or crypto, buying gold for "appreciation", paying off another personal loan with a longer-tenure personal loan (the headline EMI drops but total interest paid often rises).

• KYC: PAN card, Aadhaar (for OTP-based e-sign), passport-size photo.
• Salaried: Last 3 months payslips, last 6 months salary bank statement, Form 16 or last 2 years ITR.
• Self-employed: Last 2 years ITR with computation, last 12 months current account statement, GST returns if registered, business registration proof.
• Optional: Existing loan statements to show conduct, rent agreement for address proof.