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How to Get a Personal Loan as a Self-Employed Person

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Created on
May 25, 2023


What’s Inside

Getting a personal loan if you're self-employed vs. if you're salaried, are two different cases. This is because lenders like banks or NBFCs see salaried people as more capable of loan repayment as they will have established a steady source of income. Self-employed people, on the other hand, need to prove their 'source of funds' a little harder. This can largely be the case because as a self-employed person, your monthly income could be erratic.

Especially now given the current job market, many people from the organised sector are seeing their jobs being cut, pushing them into the 'self-employed' category, freelancing, starting their own companies, or simply taking career breaks.

Regardless of why you choose to be self-employed, needing a personal loan is not unusual. Be it for emergency family expenses or just the sudden need for capital. In this blog we explore the criteria you need to meet to get access to personal loans as a self-employed person.

Eligibility Criteria and Documents

To be eligible for most loan providers, you must be an Indian citizen, which you most likely are.

But with regards to income, here are some important points:

  • Show an income of more than ₹10,000 per month
  • It's ideal if you're between 19 to 70 years
  • Prepare savings account statements showing the last 4 months of income
  • A credit score of more than 700. But above 800 is preferred.

Even if you have no income proof, an active bank account is necessary.

Next, check out the different documents needed for loan approval. Sometimes, lenders ask for your Aadhar or PAN card as ID proof. Aadhar, Voter ID, PAN, or electricity bills can stand in as address proof.

Online vs offline application

By now, most banks or lenders have their personal loan application process fully digitised, making it way simpler than it used to be.

Interest Rates

Another crucial factor while you choose your lender is the interest rate, which impacts your EMI. If the interest rate is high, the EMI will be steeper, which can be an issue.

3 factors that affect your personal loan interest rates are:

  1. Loan amount
  2. Loan tenure
  3. Repo rate and cash reserve ratio as determined by the regulatory authority

While the third one isn't in your hands, the first two are.

So, compare multiple loan providers and select the desired loan amount.

In addition, also consider the associated processing fees. This might include pre-payment charges, legal charges, late EMI fees, loan rescheduling fees and penalty charges. Together, these costs can make the loan expensive for you.


As a self employed personal loan, just like any personal loan, is an unsecured loan, most companies will offer you the loan amount without collateral. You don't need to put down your property ownership papers, or anything else as collateral against which the loan is taken.

However, you must understand the terms and conditions thoroughly. Make sure you know any regulations about using the loan amount.

Finding a Co-Applicant

If you have no proof of income, getting a guarantor can improve your chances of loan approval. The provider will assess the guarantor's payment capability and sanction the amount.

However, ensure your co-applicant has the financial stability to pay the EMI on your behalf if you cannot do so.


Getting a personal loan as a self-employed person can be more challenging than for salaried individuals. However, there are a number of things you can do to improve your chances of approval, such as having a good credit score, a steady income, and a clear purpose for the loan. By understanding the eligibility criteria and requirements, you can increase your chances of getting the loan you need.

Consider Fi Money for your personal loan

Fi Money is a great option for people who need an instant loan. The loans are pre-approved and can be deposited directly into your savings account. The process is 100% paperless and the interest rates are competitive. You can also avoid EMI late fees by setting up automatic in-app payments. The maximum loan amount is ₹5 lakh - enough to cover most small to mid sized expenses. Apply for your loan now!

Frequently Asked Questions

1. Why should I take a personal loan as a self-employed person?

Self-employed individuals can use a personal loan to cover debts, cover business expenses, pay rents or salaries, or generally stabilise their finances.

2. What are the eligibility criteria for a personal loan for a self-employed person?

The basic eligibility for a personal loan is to be an Indian citizen with income proof, like bank statements, ID proof like Aadhaar, Voter ID, Passport etc., a credit score above 750, and proof of income (some of these criteria may vary from lender to lender).


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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