Personal Loan for Jobless/Unemployed people?


27 Feb 2019 | 3 min read

A personal loan is meant to address the short-term financial needs of an individual. Usually, personal loans are designed keeping in mind the needs of the salaried /self-employed class or people who have a continuous source of income. But that does not mean that you can’t get a personal loan if you are currently jobless or are unemployed for the time being.

Being out of work is not easy on the finances since you have the household expenses to manage. There could be an emergency that might put you in a difficult situation. However, being unemployed does not mean that you are not eligible to get a loan. There are a number of loan options you can consider when you do not have a regular flow of income. Here is all you need to know about personal loans for unemployed. 

Types of loan options

Gold loan: A very common form of borrowing for unemployed individuals, a gold loan is quick and hassle-free. You simply need to walk into the nearest branch to get a loan. The documentation is basic and the loan carries attractive interest rates. You can use the gold you own as collateral and apply for the loan. 

Secured loan: Even if you do not have any constant source of income, you can get a personal loan. Known as a secured loan, the personal loan will require you to provide collateral against the funds. It will reduce the risk for the lender and you will be able to enjoy a low-interest rate. When you are not employed, this is an ideal loan solution for you. By giving collateral, you can enjoy access to funds. 

Unsecured loan: If you have a good credit history, you have a higher chance of getting an unsecured loan. There is no need for collateral and the loan amount will be based on your profile and repayment history. The loan has a slightly higher interest rate as compared to a secured loan. 

Government loan schemes for the unemployed

In is indeed difficult for an unemployed individual to find a loan. This is why there are schemes launched by the Centre and the State Government that make the process of availing a loan convenient and easy. 

1#. Pradhan Mantri Mudra Yojana for Women: The Government scheme aims to improve the status of women by providing them funds and encouraging them to start new ventures. There are many lenders that offer MUDRA loans to applicants.

2#. Prime Minister Rozgar Yojana: This scheme offers loans to unemployed so that they can start their own business venture. Individuals aged between 18 to 35 and educated until Class 8 are eligible for the scheme. The maximum loan amount under this scheme is Rs. 5 lakh

3#. Agriculture loan: Individuals who are unemployed and engaged in the agriculture sector are eligible for the loan. Any individual above the age of 22 can apply for an agriculture loan. 

4#. Loan subsidy for unemployed youth: The Government of Tamil Nadu has a scheme for the unemployed which is known as New Entrepreneur and Enterprise Development Scheme. Under this scheme, the government gives a 25% subsidy on loans for unemployed, graduate youths. However, there is collateral required for the loan. 

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Personal Loan for Jobless/Unemployed people Eligibility criteria

The applicant should be above 18 years of age in order to apply for the loan.

Documentation required

  • Residential proof
  • Age proof
  • ID card
  • PAN card
  • Aadhaar

What are the Best Ways to Get Personal Loan for Jobless/Unemployed people?

✅ Speak to your banker

If you used to get a high and steady income earlier and also had an excellent repayment history, especially with the bank where you had your salary account, you should apply for a personal loan at this bank. Three important factors, namely, your credit history, income tax returns and employment history may be of much help here.

If you are still not able to get through, try to get an instant personal loan from any of the co-operative banks. As they do not have stringent eligibility criteria, you may end up getting your loan approved here.

✅ P2P lending companies

Peer to Peer or P2P lending companies is another easy and quick option to get a personal loan online for you. The sole objective of these companies is to make credit available in an affordable and seamless manner. You can even get a personal loan here at an interest rate that is less as compared to those offered by some of the commercial banks to unemployed individuals.

✅ Loan against fixed deposit

If you are having a fixed deposit with a bank, then it may consider granting personal loans for unemployed against the FD, which is basically a secured loan. You are likely to get a credit amounting to 75 % -80 % of the FD amount, with an additional charge of 2 % - 3 % in interests.

✅ Loan against a life insurance policy

If you have a life insurance policy in your name, you can avail of personal loans for unemployed against the life policy too. But, the loan will be granted only after the policy gets transferred to the name of the lending institution. The personal loan interest rate is calculated depending on the premium amount and the number of times the premiums have been paid prior to the time of the loan application.

More: Best Personal Loan apps for Instant Personal Loan online

Have you checked the personal loan interest rates for these banks?


Interest Rate Loan Amount Tenure

Lazy pay

15% to 28%

Up to Rs 100000

3 months to 2 years

Smart Coin

30% to 35%

Rs 1000-25000

3 to 4 months

State Bank of India Pension Loan

11.95% to 12.45%

Rs 2.5 lakh to Rs 14 lakh

Up to 7 Yeas

Punjab National Bank – Pension Loan for foreigners


Rs.25,000 to Rs.3 lakh

Up to 5 Yeas

Bank of India – Star Pensioner Loan Scheme


Upto Rs 5,000,00

On the basis of lenders’ terms & conditions

Prime Minister Rozgar Yojana

On the basis of specifications of scheme

Upto Rs 10,000,00

3 to 7 years

Secured unemployed loans have benefits –

  • Competitive interest rate
  • Convenient and flexible repayment terms
  • Long term tenure
  • Smaller individual loan payments
  • Tax-deductible interest
  • Collateral not required
  • Co-signer not required
  • Loan approval is fast
  • Fewer documentation

Tips to enjoy a quick loan approval for unemployed individuals

Here are some suggestions you can follow in order to increase your chances of getting a loan approved.

  • Build a good credit history. Whenever a lender sees a strong credit score, he feels confident on your ability to make the loan repayment and he will approve your application.
  • Wherever possible, apply with a co-applicant as it will increase the chances of getting a loan. The income of a co-applicant will be considered when considering the loan application. It will provide better terms, low interest rate and a high loan amount. 
  • You can get a loan when you are jobless through a third party guarantee. When a lender gets the guarantee that the money will be repaid, there will be no hesitation on their part in sanctioning the loan. 
  • Provide collateral for the loan and ensure that it is approved in no time. When you provide a collateral, you increase the chances of your loan approval even without any flow of income. 
  • Once you get a personal loan, ensure you make timely repayment of the same to build a strong credit score. 

Contact Us: can help you get the best personal loans for unemployed online.  You can personal loan online apply from us and check your tentative EMI/ eligibility using our utility tools such as Personal Loan EMI calculator and Personal Loan Eligibility calculator.

Our dedicated experts will always be there to provide you with the best possible financial advice, tailored to your specific needs. Our best services are offered to you absolutely free of cost.

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