How to Get a Personal Loan Without a Salary Slip in India?

Personal loans can prove helpful in consolidating your existing debts and helping you meet financial emergencies. You can even procure a personal loan to finance special occasions such as a marriage ceremony or an anniversary holiday. It is one of the most popular types of loans available in the market today.

A personal loan is an unsecured type of a loan. This means that it does not need you to pledge an asset as collateral in exchange of the loan amount. The lender generally provides you with the loan simply by evaluating and confirming your source of income.

You would require a few essential documents for the personal loan application process. These usually include your salary slip, proof of identity, proof of residence, and bank statement of the past three months. However, if you are self-employed or unemployed, you might not have a salary slip. This might make you wonder – ‘Can I get personal loan without salary slip?’

The answer is yes! This is good news for those who work as freelancers or even people who are between jobs at the moment. Many banks offer instant loans for unemployed people. This way, everyone can get access to funding that they need as long as they have their documents in order.

So, let’s see how you can get a personal loan without salary slip.

Provide proof of an alternate source of income

A salary slip is proof of a stable income. The lender requires you to provide a salary slip because they want assurance about the repayment of the debt. If you are a freelancer, a business owner, a contractor, or anyone as such who does not receive a salary slip, you can easily get a personal loan by providing the lender an alternate proof of stable income. Income certificates, ITR or form 16, and bank account statements are some of the most commonly accepted documents in place of a salary slip. Providing any of these documents can help you get an instant personal loan approval as per the bank’s timelines for the process. So, make sure to keep all these documents safely as you will need them when applying for a loan.

Maintain a good CIBIL score

Your CIBIL score is essentially the measure of your creditworthiness. It reflects your history of repayment, your credit handling capabilities, and the status of your existing debts. Your CIBIL score gives the lender an idea about your possible approach to loan EMIs. If you wish to get a loan without salary slip and bank statement, maintaining a good CIBIL score is particularly important. Generally, having a CIBIL score above 750 is an indication of a responsible borrower. The CIBIL score is also a key factor in determining the interest rate that is charged on your loan. Thus, having a good score also helps you procure a personal loan at a lower interest rate.

Offer collateral as security

You can also offer to pledge an asset to the lender when applying for a personal loan. This will help in giving the lender a sense of security about the repayment of the debt. Assets such as gold, high valued fixed deposits, mutual fund units, and real estate can be used as collateral for a personal loan. However, you must check with the lender if they sanction asset-backed loans. You should also get an understanding of the assets that are accepted by the lender. The acceptance of your collateral as a security for the loan would depend on its total value. If the value of the collateral offered is more than the personal loan required, you have better chances of getting your personal loan approved. However, do remember that defaulting on your EMI payments might force the lender to seize your asset. Thus, only provide collateral if you are confident on your capability to repay the debt.

Apply for the loan with a co-applicant

A co-applicant is someone who takes the responsibility of repayment of the debt along with you. Applying for a personal loan with a creditworthy co-applicant increases the chances of your application being approved by the lender. Due to the co-applicant's steady income and creditworthiness, the lender gains confidence in your capability to repay the debt. If you default on your EMI payment, the lender can trust the co-applicant to fill in the gap. As a result of this, the chances of your loan being sanctioned increases quite significantly. This can help you procure the personal loan on much easier terms. It is important to keep in mind that if you along with the co-applicant default, both of your credit scores are negatively affected.

Maintain a good rapport with the lender

Lending money requires trust. The lender must trust that the debt will be repaid responsibly by the borrower. Paying your EMIs on or before the due date, offering to pledge collateral, being polite towards the lender, providing accurate details about yourself, and maintaining transparency can help the lender gain trust in your capability to repay the loan. If you have previously procured a loan from the lender or have an already running account with them, things can work in your favour. This is because the previously completed transactions help the loan provider gauge your creditworthiness without requiring any additional documents. If you have a good rapport with your lender, you can also apply for a personal loan on Aadhaar card without salary slip.

What are the documents required to get a personal loan without salary slip?

When applying for a personal loan, you will need to submit certain documents for the lender to evaluate. Here are the documents that are needed if you are applying for a personal loan without a salary slip -

• A document that is a proof of your identity, such as your passport, driving license or Aadhaar card
• A document that is a proof of your residential address, such as a utilities bill that is not more than three months old, passport or a leave and licence agreement
• Documents that act as a proof of your income, such as like ITR or form 16, audited financials of past two years, or income certificate
• Your bank statement of past 6 months
• Office address proof for business owners
• Document that serves as a proof of ownership of the office for business owners
• Proof of continuity of business for business owners and freelancers

In addition to these documents, you will also have to submit two passport size photographs.

Do note that the above-mentioned documents are commonly required by the lenders. However, there can be changes in the list of documents depending on your financial situation and the lender’s requirements. Hence, it is best to check with the loan provider about the documents that they require to consider you eligible for a personal loan.

If a co-applicant is involved, they too would need to provide documents as required by the lender.

Conclusion:

Your creditworthiness plays a vital role in determining your eligibility for a personal loan. Thus, if you are looking to get an instant personal loan without salary slip, you need to build trust and confidence in the lender about your repayment capabilities. That way, you will come across as a responsible borrower. Do remember to also check the loan eligibility criteria, EMIs, and tenure of the loan before you apply.