Self-employment offers many benefits, such as freedom, flexibility, and control. However, one common challenge self-employed individuals face is getting personal loans. Unlike salaried employees who can provide proof of income through their payslips, self-employed individuals have a challenging time proving their income. This makes it difficult to assess their creditworthiness when they want to secure a loan.
In India, getting a personal loan as a self-employed individual can seem intimidating, but it's possible. This article explores how self-employed individuals can get loans through loan apps in India.
What is a Personal Loan for Self-Employed Individuals?
A personal loan for self-employed individuals is an unsecured loan that provides money for various personal or business-related needs. You can avail of these loans from a bank, financial institution, or a loan app in India to fulfil your financial needs. Unlike business loans specifically designed for business purposes, a personal loan for the self-employed can be used for various reasons, such as debt consolidation, medical expenses, or other personal needs. Personal loans typically have set repayment terms that enable you to repay the loan in monthly instalments over the agreed-upon period.
Eligibility Criteria of Personal Loans for Self-Employed
Before applying for a personal loan, it's essential to understand the eligibility criteria set forth by lenders, which generally include the following:
Age
Applicants should be within the age bracket specified by the lender, usually between 21 and 65 years old.
Income Proof
Self-employed people must provide documentation of their income, such as Income Tax Returns (ITRs) for the past three years, profit and loss statements, and bank statements.
Business Stability
A minimum business tenure of at least three years is required to demonstrate business stability and credibility.
Credit Score
Lenders consider your credit score as an indicator of your creditworthiness, so you should showcase a good credit score to secure favourable loan terms and interest rates.
How Do You Obtain Personal Loans as a Self-Employed Professional?
Applying for a personal loan is very easy with the help of personal loan apps like True Balance. Read through the given steps to learn the step-by-step process of getting a loan:
Download the App
Go to the App Store or Google Play Store on your mobile and download your desired loan app.
Registration
Register for an account on the app by providing your mobile number and complete your profile by providing the necessary information.
KYC Verification
Complete the Know Your Customer (KYC) process by providing a photo of your government-issued ID, a selfie, or other documents.
Provide Financial Information
Enter details related to your income, business, or employment status and provide all supporting financial documents.
Review Terms and Conditions
Once you’ve selected the amount and repayment period, carefully review the terms and conditions of the loan, including interest rates, fees, and repayment terms.
Submit Application
Submit your application through the app and wait for the lender to review your application. If your application is approved, the loan amount will be disbursed to your registered bank account.
Parting Words
Securing a personal loan as a self-employed individual in India requires careful planning, understanding of eligibility criteria, and exploration of various financing options. True Balance, an emerging personal loan app in India, offers a comprehensive suite of loan solutions tailored to the specific needs of self-employed individuals. With a commitment to customer satisfaction and flexible financing options, True Balance simplifies the application process and provides quick access to money.
Whether you need financial assistance for personal expenses, business expansion, or debt consolidation, True Balance is dedicated to helping you achieve your financial goals. Their experienced team provides personalised guidance and support throughout the loan process, ensuring a seamless and hassle-free experience.
Also Read: How to Apply for a Personal Loan to Make Your Christmas More Enjoyable
