Personal Loan Eligibility: Step-By-Step Guide to Check How Much Loan You Can Get Now
Written by Mariyam Sara
2 min read | Updated on November 13, 2025, 19:20 IST
Eligibility Criteria for a Personal Loan
Factors Influencing the Eligibility Criteria for a Personal Loan
Credit score plays a crucial role when availing a loan. Lenders prefer candidates with good credit scores to lower their risk. Individuals with high credit scores can negotiate the terms and interest rates of their personal loans. Hence, make sure you have a good credit score before applying for a loan
How to Improve Your Credit Score?
Upstox is a leading Indian financial services company that offers online trading and investment services in stocks, commodities, currencies, mutual funds, and more. Founded in 2009 and headquartered in Mumbai, Upstox is backed by prominent investors including Ratan Tata, Tiger Global, and Kalaari Capital. It operates under RKSV Securities and is registered with SEBI, NSE, BSE, and other regulatory bodies, ensuring secure and compliant trading experiences.
A personal loan is a financial tool used by individuals during financial emergencies. Today, you can avail a personal loan online within minutes. These personal loans are unsecured loans that don't require any assets to be reserved as collateral.
One of the main components of a personal loan is the loan amount, which depends on the candidate’s income and credit score.
Eligibility Criteria for a Personal Loan
Here is the eligibility criteria a candidate should fulfil to avail a personal loan online.
- Minimum Age Requirement
The applicant should be at least 18 years of age.
- Income Requirement
The candidate should provide proof of consistent income that shows the individual's repayment capacity.
- Salaried Employees
Salaried employees who work in the public or private sector are eligible to avail a personal loan.
- Self-employed Individuals
Self-employed individuals or businessmen earning a certain amount are eligible to avail a personal loan.
- Credit Score and Payment History
A credit score is a crucial factor that determines your eligibility for a personal loan. Most lenders offer personal loans only to candidates with a credit score between 720 and 760. Having a good repayment history shows the lender that the candidate can repay his debt obligation on time.
Factors Influencing the Eligibility Criteria for a Personal Loan
Here are the factors that impact the eligibility criteria for a personal loan.
Age
The age of the candidates applying for a loan should be 18 and above. A minor cannot take a personal loan.
Geographic Location
Regulations may vary among different regions in the country, affecting the eligibility criteria for a personal loan.
Income
The candidate applying for a personal loan should have a consistent source of income. The minimum income to avail a personal loan is ₹25,000.
Existing Debt
If a candidate already has EMI commitments for different loans, this will impact the individual’s repayment capacity. This will affect the eligibility for the personal loan.
Type of Employment
Individuals with jobs in the public or reputed private sector are highly eligible to avail a personal loan. Lenders prefer candidates with a consistent source of income, as it reduces their default risk.
Credit Score
Candidates with high credit scores are considered ideal by the lenders. Individuals with good credit scores have their loans approved immediately because lenders consider them as low-risk candidates.
Credit score plays a crucial role when availing a loan. Lenders prefer candidates with good credit scores to lower their risk. Individuals with high credit scores can negotiate the terms and interest rates of their personal loans. Hence, make sure you have a good credit score before applying for a loan
In India, most lenders require candidates to have a minimum credit score of 700 to avail a personal loan.
How to Improve Your Credit Score?
Here’s how you can improve your credit score.
Review Your Credit Score.
Review your credit report and look for any discrepancies or errors that may have caused your credit score to fall. If you do identify some errors, have them rectified immediately.
Pay Pending EMIs
Settle all your past dues, along with the penalties, so that your credit score can improve and you don’t accumulate more penalties.
Avoid Applying for Multiple Loans
When you apply for a loan, the lender pulls up your credit report and performs a credit check. If you aren't a desirable candidate for them, they will reject your loan application, which will negatively affect your credit score.
Lower Your Credit Utilisation
Try to keep your expenditures below the credit limit so that you don’t go above the limit, leading to a fall in your credit score.
Take Low CIBIL Score Loans
Certain lenders offer loans to individuals with low CIBIL scores. You can opt for those and use them to better your credit score by making timely payments and staying below the credit limit.
Your loan amount is determined based on your income, credit score and nature of employment. Out of these three, there’s one factor that you can change and improve quickly: your Credit score. To increase your chances of availing a personal loan with a higher loan amount, work on improving your credit score.
About Author
Mariyam Sara
Sub-Editor
holds an MBA in Finance and is a true Finance Fanatic. She writes extensively on all things finance whether it’s stock trading, personal finance, or insurance, chances are she’s covered it. When she’s not writing, she’s busy pursuing NISM certifications, experimenting with new baking recipes.
Read more from Upstox