Medical Loan for Surgery/Treatment: 8 Ways to Arrange Money

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The cost of medical treatments/operatives or surgery in India has risen drastically in last decade or so. Although India is considered to be the preferred destination for medical tourism and ranks in top 5 countries; the cost is still very high for an average Indian. This is because for a global tourist, the treatment cost (in dollars) they pay in their native country is high. Whereas, the same treatment cost is converted to Indian currency is very little for these tourists.

So how can a common man arrange money for expensive medical operations especially during emergency? Because arranging such a huge amount of money is very difficult.

Best option to arrange money is to take loan for medical treatment. Medical loan for surgery is basically a personal loan taken for treating health problems. In India, there are various options available to get medical loan for treatments.

Listed in the below table are the financial institutions or lenders who offer loan especially for medical operation:

Non-Banking LendersTrust / Charitable FundGovernment Funds/Schemes
Arogya FinanceNargis Dutt Memorial Trust (for cancer)Prime Minister National Relief Fund
MYA Health CreditYuvraj Singh Foundation (for cancer)Schemes under the Ministry of Health and Family welfare
Healthy Heart for AllThe Cancer Patient Aid Association
Bajaj FinservCancer Care Trust
hCueYoddhas (for Cancer)
First Hand Foundation (for Cancer)
Indian Cancer Society
Local NGOs
Narayana Multispeciality Hospital

1) Non-Banking Lenders:

Above listed non-banking lenders are medical loan providing companies operating on a core belief of providing quality healthcare for every India at affordable price. Apart from loan, they provide many other healthcare services.

How is the money paid to the borrower by non-banking lender?

Once you apply for the loan online and the application is approved, the money is directly paid to the hospital. All these financiers have direct contact with hospitals and doctors. Benefit of taking medical loan from such lenders are that there is no requirement to provide income documents or any form of collateral.

Other options to arrange money for medical treatment are:

2) Trust/Fund:

Above listed trust offer financial support especially to the poor people. There are many NGOs who get required support through local politicians. Narayana Multispeciality Hospital offers cheapest heart surgeries in the world.

Check out where to get low cost liver transplant in India.

3) Government Fund:

There are many government schemes such as Prime Minister National Relief Fund (PMNRF) and Schemes under the Ministry of Health and Family welfare which offer financial support to the individuals/families from the poor section of the society.

4) Personal loan from bank or finance companies:

You can also apply for a personal loan at private, public or co-operative banks and used the money for required medical treatment. However the problem with these financial institutions is that they offer loans only to select individuals depending on their evaluation criteria especially credit score.

Here’s the list of prominent banks or finance companies where can you apply for personal loan for medical treatment.

  • State Bank of India – Medi Plus Scheme
  • HDFC Bank
  • ICICI Bank
  • Bajaj Finserv – Has tie-ups with prominent medical centers and offers loan for various surgeries such as Bariatric, Laparoscopic, dental treatment, In Vitro Fertilization, eye care, stem cells and hair restoration.
  • Many other public, private or co-operative banks in India offer personal loan.

Typically this loan is unsecured, requiring no security by the bank. And no reasons for taking loan is required to be provided to the bank. However you can also get personal loan against LIC policy, equities, property, and fixed deposit which are nothing but loan with collateral.

5) Ask your friends/relatives:

This typically is the first option used to arrange money in the time of emergency. However not everyone has capacity to extend support due to personal obligations or kind of relation you have. Moreover many of the treatments required huge sum of money, which is actually not possible for a common man to arrange.

6) Peer to peer lending online marketplaces:

These are the online marketplaces where borrowers can apply for loan at multiple borrowers (mainly individuals). Interest rate can be bargained. P2PL have started gaining lot of popularity in the recent years due to less tedious application process, eligibility criteria and affordable rates compared to banks. Read more in detail about peer lending companies in India.

7) Health Insurance:

This is no doubt the must have component in every individuals financial planning kitty. Although it’s not an investment; but still it saves money. When the insured person is hospitalized, the treatment cost is bourne by the insurer. There are many medical insurance providers in India such as ICICI Lombard, Bajaj Allianz, Bharti AXA and others. The biggest problem with health insurance is that claim applications are not honored in many cases, due to the strict underwriting rules especially when the claim is made against pre-existing diseases. And claim made, within months of buying the policy are rejected due to the waiting period in many cases.

8) Private money lenders:

This should be the last option an individual should use. Because the interest rates are highest compared to banks/other financial entities or P2PL and others. And the recovery process is very substandard in many cases.

Cost of surgeries and treatments in India:

Following surgical procedures or treatments cost very high in India. And listed in the below table are the average price patient has to pay. The cost varies depending on the city and hospital and other procedures involved in the treatment:

Surgery/Operative/Treatment ProcedureEstimated Cost in Rs. (average)
In-Vitro Fertilization1,50,000 per cycle (1.5 Lakh)
Angioplasty2,00,000 - 3,00,000 (2-3 Lakh)
Chemotherapy30,000 – 40,000
Angiography25,000 – 40,000
Kidney TransplantOver 10,00,000 (10 Lakh)
Liver transplant Over 25,00,000 (25 Lakh)
Open heart surgeryOver 4, 00,000 (4 Lakh)
Bariatric surgery Between 3, 00,000 – 4, 00,000 (3-4 Lakh)

Medical loan can be used for any purpose such as surgeries, therapies, day care procedures and many other health treatments. Please check with above listed financing companies on eligibility criteria.

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6 Ways to Get Personal Loan for Jobless/Unemployed

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Steady income is the most important decisive factor when it comes to personal loan. Based on your income, application is either approved or rejected. However there might come a time when you go jobless. And not being in job/unemployed is very common scenario in today’s world.

And in such situations, shortage of money is obvious assuming you have a very limited savings. But at the same time, when you apply for loan; the application is going to get rejected, as there is no income.

Personal Loan for Individuals with No Job

So can you get personal loan when jobless i.e. at a time when you badly need the money? Answer is YES, it is possible. Because your income is not the only factor, on the basis of which loan application is decided. There are several other factors such as:

  • Credit history
  • Employment history
  • IT returns

Now there could be various categories of jobless as follows:

  • Who have been in job earlier but are currently unemployed
  • Who are searching for job for the first time especially recent graduate
  • Who were in business earlier but are now looking for the job

In this article, we’ll discuss about the first category of individual i.e. who were earlier getting steady income but due to some reasons, they are currently jobless and seeking for personal loan.

Ask your existing bank:

If you were getting steady and high income earlier and had excellent repayment history with your bank (especially bank with whom you had salary account), then you should first apply for the credit at the bank. The three other factors mentioned above such as credit history, employment history and income tax returns, can come to your rescue at this point.

Especially a good credit score, proves that you are not likely to default in the future. And assuming your income was high, it is likely expected that your future income will be mostly on the higher side and repayment will be done in a timely manner. There is also a possibility that, interest on loan might be on the higher side, but still you will get access to cash, in the financial crunch phase.

If commercial banks deny your application then you can also try to get loan from co-operative banks. The chances of approval are high as their eligibility criteria are not very stringent.

Peer to peer lending companies:

Another quick and easy option for unemployed individuals to get personal loan is from peer to peer lending companies (also called as P2PL). The prime objective of P2PL marketplaces is to make access to credit in a seamless and affordable manner. When we say affordable, it means the interest rate offered is less compared to the commercial banks. People with no job in hand currently, should definitely approach these online money lending marketplaces. There are many individuals who are ready to borrow their money with interest rate less than the banks. Read more on P2PL benefits.

Ask your friends/relatives:

Ideally this should be / is the first option, an individual takes into consideration when in need of money. However not everyone has capacity to provide helping hand even when mutual trust exists. But what you can do is, ask your acquaintances to lend money but in return of interest. Chances are quite higher that, you may get money. Because your acquaintance has some monetary advantage. Many times, people have in mind that what will I gain after lending the money? So being practical helps in such conditions.

Against fixed deposit:

If you already have fixed deposit with the bank, then loan against FD is another feasible option, provided you do not want to break FD to raise the money. It is actually a loan against security. In this case, security is the money you’ve kept in fixed deposit. And the credit you can get is around 75%-80% of the money kept with the bank and an additional interest of 2%-3% is charged.

So if the FD interest rate offered by the bank is 10% and bank charges 2% additional borrowing charge then you will have to pay 12% rate per annum, which is monthly 1%. So as you can see, the interest rate offered is very less than the standard loan rates which are typically above 15%. There are few more benefits apart from lower interest rates such as:

  • No pre-payment and processing charge, with most of the banks
  • Repayments are flexible with an option of paying either lumpsum or in instalments

Against life insurance policy:

Similar to loan against FD, if you have life insurance policy on your name, then you can get loan against life policy as well. And the benefit remains the same as mentioned above i.e. low lending rate. However remember that, the policy is transferred in the name of the financial institution and post that only, the loan is granted. The lending rate is calculated on the basis of two factors: premium amount and the number of times premiums paid till the time of application.

Private money lenders:

These private financiers offer loans especially to local borrowers. However the interest rate are very high and many of operate without getting license from the government. And most importantly, the kind of harassment borrower faces in an event of non-payment of dues, is very bad.

So basically the above listed six options to get personal loan for jobless individuals has its own pros and cons. But remember one thing – always have a good credit history. It is very important for a good financial future.

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Private Money Lenders: Pros, Cons, Risks

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Personal loan is the widely used option to meet the urgent need of money. There is no other option (apart from asking acquaintances) to get money in such a short span of time.

There are many ways to get personal loan in India as follows:

  1. Public, private, co-operative banks
  2. Peer to peer lending (P2PL)
  3. Against securities such as LIC policy, property, fixed deposit, credit card

Private money lenders or financiers basically are non-banking financial entities such as traders, non-traders and others who offer loan at a very high interest rate. Although government provides license to these loanee but there are many who operate illegally.

Pros:

No credit history check: When you apply for personal loan at any bank, the very first thing they check is your credit history. However not every applicant has credit score which matches the bank’s requirement. In fact, there are individuals who do not have any credit history. So in many cases, this results in application getting rejected. But in case of private money lenders, there is no credit bureau check.

Quick money disbursal: Borrowers can get the funds disbursed in a short span of time. Although in case of banks where they claim to offer “personal loan in even 2 minutes”, the actual time taken to get the funds in your account is high.

Less documentation: Banks ask for various documents before processing the application, which is not the case with private financiers.

There are no prepayment and processing charges.

So basically the eligibility criteria is not very strict compared to the banks.

Cons:

The risks involved in borrowing money from private money lenders is very high.

Very high interest: Although you can bargain on the interest rates, they are very high. It ranges between 20%-45% depending on the amount and the tenure especially. Rules are made by individual lenders as there is no monitoring. But still many people accept such heavy charges, as the urgent need of money can be met easily.

Repayment period: It can be daily/weekly/monthly or as per the agreement.

Recovery: The harassment done by these lenders on the borrowers to return the borrowed money is very high. And they take help of recovery agents. And they make use of any means to recover the money. The most common way they recover money is taking control of properties, personal belongings such as gold etc. unethically.

Forged documents: There are many illegally operating lenders who create forged documents such as blank stamp papers, cheques and receipts with signatures of the borrowers. The signed stamp paper is mainly used as a proof to show that in the failure to repay the money, the borrower has transferred property in the name of the loanee.

Land grabbing: Farmers especially are mainly exploited. Because in return of money, these loanee ask for mortgaging the land. And in cases, when the farmer fails to pay monthly installments, these financiers take control of the agricultural land. And in many cases, they get land transferred on their name. This is due to the fact that the high interest rate makes the installment payment very difficult.

Licensed: Although there is a government license required to operate money lending business, still many run it illegally. And monitoring everyone is very difficult. So even if you plan to take personal loan from private money lenders, do get checked whether the lender is licensed or not. This is because, with no control, the risk increases.

Mainly following individuals often take personal loan from private financiers who often rely on cash to do their day to day work:

  • Farmers
  • Smal ltime workers
  • Small shopkeepers or business owners
  • Individuals with poor credit score

Should you still lend money from them?

If there is no option left i.e. bank/P2P/friends/relatives then you should try for private lenders. But remember to apply only at the licensed business in your area of living. As per Indian law, it is mandatory for money lenders to obtain license from the respective state government for lending the money.

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Personal Loan for One Year – Interest Rate, Monthly Interest Amount

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Sometimes circumstances can lead to individuals falling into debt trap. Even people who’ve not taken credit in their lifetime have to knock the doors of credit lenders to fulfill short term money requirement which can be as low as one year.

Let’s take example of Ravindra whose father recently got health problem. Although he had taken health insurance separately for his parents, but the same was insufficient due to the cost involved in the overall treatment. He was actually short of Rs. 3, 00,000 (3 Lacs).

In fact, his personal saving was not sufficient and taking help from friends/acquaintances was not possible, and he also had other ongoing financial commitments. So one of his friend suggested to take personal loan for one year, which seemed to be the best option at that point which was able to fulfill all his requirements. And he successfully got it without much efforts, thanks to his excellent credit history.

Read more on personal loan for low income earner.

Listed below are the banks he researched and also calculated interest amount on personal loan for 1 year. Although he opted for loan from the lender who offered best deal keeping in mind his overall financial commitments.

Name of BankInterest Rate for One YearInterest Amount in INR for Rs. 3 Lac Loan
State Bank of India12.50% - 16.60%Rs. 23233 @14%
ICICI Bank11.59% to 22.00%Rs. 21542 @13%
Kotak Mahindra11.50 - 20.00%Rs. 28337 @17%
HDFC Bank11.29 - 19.50%Rs. 22387 @13.5%
Bajaj Finserv11.49 - 16.00%Rs. 24929 @15%
IndusInd Bank12.99 - 17.00%Rs. 26631 @16%
Citibank0.1149Rs. 19855 @12%
Standard Chartered11.99 - 15.00%Rs. 24929 @15%
Axis Bank15.50% to 24%Rs. 30048 @18%

Note: Banks keep on changing the personal loan interest rate time to time. So please check current rates with the bank before applying for the loan.

Documents required:

  • PAN Card
  • Income tax returns
  • Salary slip or certificate
  • Form 16
  • Passport/Driving license/Voter ID card
  • Address proof or office ownership proof – Leave or license agreement, utility bill
  • Bank statement minimum 6 months

There are two other commonly available options to get personal loan for one year:

  • Peer to peer lending (P2PL)
  • Private financiers

Amongst these two, P2PL should be preferred due to the risks involved in private financiers such as harassment due to non-payment of dues. Moreover the interest charged is very high in case of local money lenders.

 

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Loan for Car Drivers of Ola & Uber @10.65%, No Collateral/Guarantor

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In the last few years, there has been a tremendous increase in demand of cab services of Ola and Uber in India. Especially in metro cities people are preferring these private cabs over their personal car. To meet the supply and expand their business, Ola and Uber are luring more and more individuals to join them as drivers. However not every individual, wanting to partner these cab aggregators, has financial capacity to own a car.

To over come this problem, both these companies offer car loans to drivers so that they can buy car and work for them. So it is a win-win situation for both the parties. These cab service companies are helping individuals to own car and at the same time drivers are able to overcome hurdle of becoming self employed and earn decent income and most importantly a respectable job.

Ola and Uber both offer financing for cars in partnership with various banks/lenders.

Car Loan for Uber Drivers

Uber has partnered with following Indian banks to offer loan for cars who ply on their network. Listed in the below table are the banks and the interest rate:

Name of BankInterest Rate/EMI
State Bank of IndiaUnder 12%
ICICI BankNot available. Please contact branch
Bank of Baroda10.65% 13.65%
Mahindra FinanceNot available. Please contact branch
Tata Capital0.16

Benefits & Features:

  • Loan is sanctioned instantly
  • Processing time is very low compared to normal car loan
  • No collateral required
  • Interest rates are very competitive. Interest rate from Bank of Baroda starts from minimum 10.65%
  • Very minimal documentation required
  • Customizable schemes as per the financial condition of the applicant
  • There is no need to provide income tax returns
  • Repayment is directly through the driver’s earnings. Uber deducts dues from every fare received in the driver’s account.
  • No guarantor
  • Downpayment is very less. In case of Tata Capital it is just Rs. 31, 630.

Eligibility:

  • Driver should hold valid driving license
  • Age of the applicant should be minimum 21 years

Documents required:

  • Know your customer documents
  • Valid commercial driving license

Loan for Ola Cab Drivers:

In case of Ola, it has partnered with biggest bank in India – State Bank of India. The name of the scheme is Ola Pragati program. SBI won’t be charging equated monthly installment but repayment would be on a daily basis. The interest rate charged by SBI is average 13%.

Ola has also partnered with IDBI bank and Tata Capital to offer financial assistance to cab drivers.

Read more on personal loan for low income individuals.

Features of loan by Tata Capital

  • Loan with lowest down payment
  • No foreclosure charges
  • No EMI option. Instead drivers will have to pay installment every week.
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6 Options to get Personal Loan for Holiday/Vacation

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Travel season has arrived and many people must have planned or are in the planning stage for a vacation either in India or abroad. Afterall everyone wants peace due to stressful life. When your trip is in some foreign location then arranging funds becomes a challenge especially when the budget crosses the estimate.

In such scenario the options for arranging money are:

  1. Using personal savings
  2. Asking acquaintances

If these two options does not work out then other commonly available options to get personal loan are:

  1. Banks: Public, Private, Co-operative
  2. Peer to peer lending companies i.e. loan marketplace
  3. Private money lenders i.e. any local financier
  4. Get loan against LIC policy, property, vehicle etc.
  5. Prematurely withdrawing money from investments such as equities, fixed deposit, etc.

Some lenders specifically offer personal loans for vacations. Listed in the below table are the financial institutions offering travel loan along with the interest rate:

Name of BankInterest Rate
ICICI Bank11.59%
Bajaj Finance12.75%
IndusInd Bank11.25%
Bank of India1 year MCLR + 4.5%

You can also apply for loan at following prominent banks in India.

  • HDFC Bank
  • Axis Bank
  • State Bank of India
  • YES Bank
  • Canara Bank
  • Punjab National Bank & many others

Co-operative banks also offers personal loans at cheapest rates compared to above mentioned public/private sector banks.

Personal loan from peer to peer lenders:

Also called as P2P lending, these are online marketplaces for loan exchange. Borrower i.e. loan applicant can choose from various lenders (typically individuals) and can mutually decide on interest rate. The benefit over banks is that borrower has access to multiple lenders at any given point of time and can bargain on interest rate. In addition to this, loan disbursal process is speedy compared to banks.

List of leading peer to peer lending platforms in India are:

  1. Faircent
  2. Lendbox
  3. LenDenClub
  4. i2iFunding
  5. Rupaiya Exchange

Although taking a loan for your leisure activity is not recommended but still many people want to live life at the fullest. And for such people above options are highly recommended. However amongst all the available options, taking credit from private financiers is not recommended due to high interest rate and other risks involved such as non-transparency, harassment due to repayment failure.

How to use loan amount wisely?

So now you got the money from the bank. Now it’s time make efficient use of the borrowed money responsibly. Here are the tips to make the most out of the loan:

  • Create budget: The first thing to do is plan budget. It should include every little thing that you will spend money. Air tickets, hotel booking, transport, food, and shopping, etc.
  • Get cost of flight tickets. Select the cheapest option. At the same time look for offers available on Paytm, travel aggregator’s websites, credit card etc.
  • Compare and choose hotel room which matches to your requirement. Do a thorough research before finalizing. You can get better deal if flight and hotel booking is done from the same platform (e.g. aggregator’s website).
  • Repayment plan: Although it is too early to think about repayments even before your holiday starts. But some wise planning from initial phase can ease your burden of repayment later as money saved is money earned.
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Personal Loan for Senior Citizens from 11 Banks, Loan against Securities

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Post retirement or when retirement is nearing the fear of managing cash flow during sunset year starts. Many people believe that the money accumulated during their working life is sufficient. However it is a mistake. What such individuals don’t consider is the inflation, rising healthcare costs, increasing life span and at the same time protect dependents.

So in case of emergency when own savings is not sufficient to fulfill the need, the option remains is the personal loan. However getting personal loan for senior or retired individual is not easy as it is for a working professional. Let’s understand the reasons behind this.

Personal loan approval is dependent on four most important factors which are as follows:

  • Income
  • CIBIL score
  • Age
  • Loan amount

Other factors also play a major role but above mentioned factors holds most importance.

A regular income earner has higher chance of meeting these eligibility criteria. However for a senior or retired individual (with no income or pension), the chances of loan approval are very less as they don’t have an income post retirement. Age factor is also one of the reason for rejection, as most of the banks normally provide loan to individuals with maximum age of 60 years.

Read more on 7 best jobs to earn money after retirement.

So under such conditions, how can senior citizens get personal loan in India so that need of money can be met especially during emergencies?

There are many options available in the market for senior people to avail loan as shown in the table below:

Public/Private Sector BankCo-operative BanksAgainst Shares/LIC Policy
State Bank of IndiaAryapuram BankAditya Birla Finance
Syndicate BankCalicut city service co-operative bankAxis Bank
Allahabad BankAkola Janta Co-operative bankIDBI Bank
Bank of IndiaLIC Housing Finance
IDBI BankHDFC Bank
Dena BankICICI Bank
Andhra Bank
Bank of Baroda

Few details on getting loan from above entities:

State Bank of India: SBI offers loans to pensioners of central and state government with age limit set to 72 years with a loan amount of Rs. 14, 00,000 (14 Lakhs). However in this case the repayment tenure is small.

Allahabad Bank: Age of the pensioner should not exceed 73 years

Bank of India: BoI offers loans to pensioners with age less than 75 years.

IDBI Bank: Offers reverse mortgage loan for citizens above the age of 60 years.

Dena Bank: For pensioners with age not exceeding 73 years and 80 years.

Andhra Bank: Offers personal loans to individuals drawing pension in the branch.

Bank of Baroda: For individuals with age not exceeding 65 years.

Syndicate Bank: For pension account holder with the bank and age not exceeding 70 years.

Check out retirement investment tips.

Co-operative banks:

Many co-operative banks also offer loan to senior citizens. Few of them are:

  • Aryapuram Bank
  • Calicut city service co-operative bank
  • Akola Janta co-operative bank

Personal loan against shares:

This is offered by many public and private sector banks in India such as HDFC bank, Axis bank, ICICI bank, and many others. Individuals including senior person can pledge shares from any depository with the bank and get finance. So there is a good chance to monetize assets.

Also see home loan for retired.

Against LIC policy:

Similar to loans against shares, many credit lenders also offer loans against money back or endowment life policies. Senior citizens can avail loan by pledging their policies. Few lenders are Aditya Birla Finance, Axis Bank, LIC housing finance, IDBI Bank.

Private lenders:

There are many private money lenders offering finance at high interest rate compared to banks. However you should be careful as it is an unregulated lending market even though getting a loan is hassle free and quick process. Private financiers should be the lost option.

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Self Employed Loan Rejection: 7 Most Common Reasons

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Salaried individuals are always liked by financial institutions. Because when they offer any credit to this category of individuals the repayment is expected to be done – fully and on time and risks involved are less.

However there is another category of individuals – self employed who have equal rights to get credit but are most often denied. Even if their earnings are higher than salaried individuals, getting loan approval is difficult because of following reasons:

Risk: Not all businesses will continue to remain in profit all the time. There would be times when business may drop impacting the revenue. In such cases, repayment of loans often becomes difficult for the borrower. So basically, risk is a crucial factor which banks assesses before approving any loan application. Although banks take into consideration long duration financials for tracking business performance, a frequent loss creates doubt to the bank. Afterall if such an individual or business turns out to be a non-performing entity then losses would be high, impacting the profitability of the bank.

Income: Since ups and downs are part of business cycle, the current account held by the owner may not have sufficient balance all the time. Also there is a possibility that transaction history of such account may not be at its best. Also many customers still prefer paying in cash rather than online transfer/cheque/demand draft. So such transactions do not make entry into the account as mentioning the source of income cannot be considered as a valid proof.

Read more on personal loan for self employed.

Multiple business owners: In case of a partnership firm, the chances of loan approval are further grim. This mostly happens when one of the partner has poor credit score impacting the credibility of the other partner.

Business address: It is quite common that in the initial phase of the business, individual starts working from home and mentions his/her personal address as business address. This is disliked by the creditors as they generally offer loans to well established or with location operating from a commercial space. Although this ideally is the last factor taken into consideration.

Check out details on getting credit card for self employed.

Income tax: Typically banks asks for last two years income tax to judge the risks. However if the business is newly started then providing the income tax related documents is impossible. In such cases, banks will scrutinize the application more minutely. If business is running into losses, then banks will review IT returns of couple of more years.

Documentation: For self employed individuals documents required for loan application is little different and includes business continuity proof, last 6 months bank statement, income tax return of last 2 years, certified financials. All these documents may not be available with everyone especially when the business is newly started. So it takes personal visit to the bank to support your loan application.

CIBIL score: The most important decisive factor taken into consideration by financial institution is the CIBIL score. A poor score has higher chances of credit denial whether the applicant is self employed or salaried. However in case of self employed especially those who freshly start a business and has no CIBIL score the possibility of getting a loan is low. This is because, lenders have no way to judge the credit worthiness of the applicant.

Other options for self employed to get loan:

Even if banks reject personal loan application, it’s not the end of the world. There are other options available in the market to get loan which includes:

  1. Co-operative banks: Compared to commercial banks, co-operative banks do not have strict guidelines and have easier terms and conditions. Although the quantum of money granted is less. But on the other hand the interest rates are better. Another benefit is that processing fees or prepayment penalty is NIL or very less.
  2. Peer to peer lenders: Short termed as P2PL, this is a fairly new concept in India. Read more on P2PL here. The benefits offered are attractive rates, faster processing, speedy disbursal and easy application process.
  3. Local financiers: Borrowing money from these private financiers should be your last option as the interest rates are very high. Although they do not check CIBIL score and have very simple eligibility criteria.
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Close HDFC Personal Loan in 2 Steps, Imp. Things to After Closure

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It’s a golden rule to repay any type of loan before the term ends. This is because personal loan carries a very high interest rate compared to other loans. So getting yourself out of recurring debt will help in saving good amount of money.

In India, there are multiple avenues to get personal loan such as commercial lenders, co-operative banks, peer to peer lenders, local money lenders, and others.

HDFC bank, India’s top most private bank offers personal loan at an interest rate of 15.75% – 20%. This article provides procedure to close HDFC personal loan in 2 steps as follows:

Step-1: Call their customer care number to get address of the nearest HDFC branch office. You can get their support number by clicking on this link.

Just select your city from the dropdown list. E.g. for top cities – Ahmedabad / Bengaluru / Chennai / Delhi & NCR / Hyderabad / Kolkata / Mumbai / Pune, 61606161 is the calling number. You need to add STD number of the city. If you are an NRI, then visit this link to get the calling number.

Step-2: Once you get the branch details, take your government issued identification document, loan account number for verification to the bank. Bank personnel will then verify all the documents and get loan account details. In case of any remaining due, you will be asked to pay the same.

Points to note: HDFC personal loan closure is not possible online or over phone. You will have to personally visit the bank to close the account.

Check out personal loan for low income earners.

Important things to remember after closing the personal loan account at HDFC:

Considering the fact that HDFC bank charges interest rate of 15.75% – 20%; quick closing of the loan account is the key for the borrower to save money spent on EMI. But closing your account does not necessarily mean, you are all done. There are certain key things you need to do for a successful closure:

  • Collect all the important documents: After HDFC personal loan is closed, collect acknowledgement letter from the bank. Collect all the documents if you have taken loan against property/securities/policy etc.
  • No objection/due certificate: Another important document to ask HDFC bank is the NOC. No objection certificate or no due certificate is officially accepted legal proof of loan account closure. The certificate states that the borrower has made all the repayments and no outstanding balance is pending.
  • Pre-closure acknowledgement receipt: If you have closed your HDFC loan account before end term; then get pre-closure acknowledgement receipt from the bank.
  • Get report from CIBIL: After 60 days of HDFC loan closure, visit CIBIL website and get your personal credit report. Key thing to check is whether bank has updated the loan account record at CIBIL stating loan account closed. If record is not updated, then E-mail HDFC bank to do so at the earliest. E-mailing will help you in case no response is received from the bank.

Read about HDFC credit card payment options.

The reason to do all these is because it will help you in case any disputes arise in the future when you apply for any type of credit or loan or if the bank get back to you stating dues are still remaining.

Various personal loans from HDFC Bank:

  • Loan on credit card: This pre-approved loan Insta Loan and Insta Jumbo loan is for HDFC credit card holder. Loan amount is within the credit card limit for Insta loan. Higher loan amount can be granted in case of Jumbo loan. Other bank’s card holder can also get loan by transferring the balance from other bank to HDFC bank credit card. After transfer you can continue payin the due in EMI.
  • Loan against securities: Instead of selling securities such as equity shares, mutual funds, gold deposit certificates, LIC policies, NSC, KVP; you can get loan by giving these securities to the bank. Interest is charged only on the amount withdrawn from the account and the time for which the amount is utilized.
  • Loan against property: Higher loan is possible by mortgaging your property with the bank. Another benefit is that the EMI is low and higher tenure.

Other types of loans offered are professional loan, loans against assest, and consumer durable loan.

Benefits of taking personal loan from HDFC Bank:

  • Eligibility check in one minute
  • Get loan approved within a day provided all the eligibility criteria are met
  • Faster loan processing
  • No hidden charges
  • Account holders can get special offers on interest rates and other charges
  • Women employees get better rates compared to others
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17 Personal Loan with No Foreclosure & Partial Prepayment Charges

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Emergency money requirement can impact financials of anyone especially those who earn less. And unforeseen events such as medical emergency, job loss, etc. can affect person’s financial health badly. At such times borrowing money in the form of personal loan is the best alternative.

You can get personal loans from following common sources in India:

  • Commercial banks
  • Scheduled and un-scheduled co-operative banks
  • Peer to peer lenders (P2PL)
  • Local money lenders

Getting yourself out of recurring debt as early as possible is the key to financial success. Sooner you pay-off your dues, better would be your finances as you will save money on EMIs and the interest. And the saved money can then be used for any other purpose such as investing etc. Check out personal loan for low income earners.

However financial institutions do not think this way as they want borrower to continue repayment as long as possible. Because for them, pre-payment of loans or partial prepayment before the end term is loss making as they lose out on EMI. This is the reason banks keep loan tenures longer or charge higher EMI to earn more profit. And this hurts honest borrowers the most. Even though they have a timely loan repayment record, they still can’t close their loan account before the standard tenure ends.

Foreclosure charge is basically a certain percentage charged on the outstanding principal amount in addition to the applicable taxes. Part prepayment is charged in a similar way but the charge is lower than the foreclosure.

But not every bank charges fee for paying the entire loan amount before the actual end of its term. Enlisted in the below table are the lenders offering personal loan with no preclosure charges or offer partial waiver along with the interest rate charged by each. Many of these lenders do not levy prepayment charges when EMI is paid for a certain number of prefixed months/years.

Name of LenderInterest RateLoan Foreclosure Charges
Axis Bank15.5% to 24%No foreclosure and prepayment charge
Bank of Baroda0.1475Nil
Oriental Bank of Commerce0.1375Nil
Punjab National Bank16% to 16.25%Nil
State Bank of India0.182Nil
United Bank of India0.1625Nil
IIFL Finance14%-18%Nil
IDFC Bank11.99% - 19.50%Nil
LendboxOn applicationNil
i2ifundingOn applicationNil
Andhra Bank0.1575Nil
Corporation Bank12.75Nil
State Bank of Mysore0.1655Nil
State Bank of Hyderabad15.25%-15.75%Nil
State Bank of Patiala0.1195Nil
State Bank of Travancore0.1245Nil
Dena Bank0.13Nil
HSBC Bank11.49% to 17.5%4% - partial prepayment
YES Bank0.14Nil - partial prepayment
Allahabad Bank12.10% – 14.60%Partial Prepayment - 2.25% of Outstanding Balance
Bajaj Finserv 0.1199Partial waiver - 2% on principal outstanding
HDFC Bank15.5% to 22.25%Partial Prepayment - 4% of Principal Outstanding
ICICI Bank15.5% to 22.25%Partial Prepayment - 5% pa of principal outstanding

Some banks may allow you to pay a certain percentage of the loan amount in a financial year, thereby reducing the burden of the loan. And even this option is better compared to loans offered by banks with pre-closure charges.

Things to do after closing personal loan:

Loan account closure gives a good sigh of relief to the borrower. However things may become problematic in future, if you do not consider following factors:

  • Get all important documents from the bank: Post loan closure, you should get back all the important documents submitted to the bank while taking the loan. Most importantly this includes acknowledgement letter given to you at the time of closure, etc.
  • No objection/due certificate: Another important document is the NOC, a legal proof of closure. This states that the borrower has made all the repayments and no outstanding balance exists. Although it is the responsibility of the lender to send NOC to the borrower but you should too not forget to ask for the document.
  • Pre-closure acknowledgement receipt: If you have closed your account by paying all the dues before the term ends, then get pre-closure acknowledgement receipt from the bank. Also try not to make pre-closure payment in cash. Cheque or demand draft can help as proof.
  • Get report from CIBIL: After 45 days of closing the loan, get report from CIBIL and check whether the lender has updated the loan account record at CIBIL. If record is not updated, then ask your bank to do so at the earliest. Make this particular communication in writing, which will act as a proof.
  • In addition to these, always keep a duplicate copy of each and every loan related documents handy including loan application, approval, closure letter, cheque payment copy, etc. And it’s best to keep soft copy of all these documents in your mailbox. Every document pertaining to the loan is critical and can help in the time of need.

The reason to do all these is because it will help you in case any disputes arise in the future when you apply for any type of credit or loan or if the bank get back to you stating dues are still remaining.

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