Credit Score Analysis for Availing a Personal Loan


A Personal Loan works like a charm when you face a cash crunch, and are in immediate need of money. Personal Loans are easily available and can be availed easily through banks or NBFCs. And the best part—you don’t need a specific reason to apply for a Personal Loan. From sponsoring your vacation abroad to refurbishing your home, you can avail such a loan for anything and everything. However, not everybody is eligible for a Personal Loan. Personal Loan eligibility differs from financial institution to the other, though the initial few are the same for all. Let’s have look at the eligibility criteria first:

Personal Loan Eligibility Norms

In order to get your loan approved, you need to be a minimum 21 years old and have a stable monthly income. For most banks and NBFCs, this stable minimum income should be above their minimum bracket.

Once you fill these criteria and apply for the loan, your loan will get approved only if you have a good credit score or the minimum CIBIL score for Personal Loan.


This is a score given by the Credit Information Bureau (India) Limited to measure your creditworthiness. This number has a very important role to play when it comes to loan approval, not just Personal Loan but all other kinds of loans.

The CIBIL receives information from all the financial institutions about the financial behaviour of each of their customers and based on this, it gives each customer a score.

750 is the minimum CIBIL score for Personal Loans. This means any person with a credit score above 750 can easily get their Personal Loan request approved without any problem.

Credit scores or CIBIL scores usually ranges from 300-900, with 300 being the lowest and 900 being the highest.

CIBIL Score and Personal Loans

Having a good credit score is a prerequisite for getting your Personal Loan application approved, essentially because these loans are unsecured. When you have a good credit score, it ensures that you are a responsible borrower and you repay your dues on time.

Does that mean, that a person with a bad credit score can get a Personal Loan? Read on to find out!

How to Get Personal Loan with Bad Credit Score?

If your credit score is lower 750, you must take all possible steps to improve it and some of them include:

Find out the reason for your bad credit score…was it late payment or default?
Make sure to pay your debts on time and never default in future
Don’t max out your credit card/s and make sure to maintain a healthy credit utilization ratio

If your loan or credit card requests are getting rejected because you have too many under your name, then stop applying. Improve your score and then reapply. Also, if you have loans nearing their tenure, then make sure to repay regularly and close them. Don’t apply for another loan immediately as it can raise questions on your financial liquidity capacity.

If you’re in immediate need, you can look for institutions that offer Personal Loan to people with poor credit score. Interest rates are generally high and make sure to use the personal loan EMI calculator, to see if you can afford it. You can consider a collateral loan as well.


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