• Loan for Unemployed

    There are lenders who offer personal loans even if you don’t have a stable job. Of course, the interest rate, loan tenure and other factors are different from loans offered to income earners, but that won’t stop you get financing from various lenders. You can get such loans in the form of secured loans, payday loans and government personal loan schemes for the unemployed, to name a few.

    Compare Best Personal Loans for the Unemployed

    Banks/Lenders Interest Rate (p.a.) Loan amount Tenure
    LazyPay 15% to 28% Up to Rs.1 lakh 3 months to 24 months
    SmartCoin 30% to 36% (APR) Rs.1,000 to Rs.25,000 3 months to 4 months
    State Bank of India Pension Loan 11.95% to 12.45% Rs.2.5 lakh to Rs.14 lakh Up to 84 months
    Punjab National Bank Personal Loan to Pensioners 11.25% Rs.25,000 to Rs.3 lakh Up to 60 months
    Bank of India Star Pensioner Loan Scheme 11.15% Up to Rs.5 lakh Based on lender’s terms and conditions
    Prime Minister’s Rozgar Yojana Based on the scheme specifications Up to Rs.10 lakh 3 years to 7 years
    Mudra loan for women Varies from bank to bank Up to Rs.10 lakh Varies from bank to bank

    How to apply?

    You can choose any of the below options to apply:

    • Through the lender’s website or mobile application
    • Directly through the bank’s branch

    Government Loan Schemes for Unemployed in India

    • Prime Ministers Rozgar Yojana- This scheme has been designed especially for the unemployed.The main of the scheme is to provide employment to the unemployed by providing them financial resources to start their own ventures. The loan is available to any youth who is educated up to standard grade 8 in India. The loan is of composite nature and a loan of Rs.2 lakh and a loan of Rs.5 lakh is advanced for business sector and industry sector respectively.
    • Loan subsidy for unemployed youth- Tamil Nadu government has a scheme for the unemployed called NEEDS(New Entrepreneur and Enterprise Development scheme).Under this scheme the state government provides 25% subsidy for loans for unemployed youth who are graduates.Collateral for the loan through banks is decided by the bank. The project estimate is between Rs.5 lakh and Rs.1 crore and the infrastructure cost of the project cant exceed 25% of the loan.
    • Cash loans for the unemployed by the Government of West Bengal- The government of West Bengal has a loan scheme for the unemployed wherein a loan of Rs.50,000 will be granted.The main aim of the plan is to help unemployed youth to start their own business/ventures.Youths between the age of 18 and 45 are eligible for this plan.
    • Agriculture loan for the unemployed- The government has collaborated with many banks to provide financial resources for unemployed agriculture graduates. This loan can be utilised for any kind of agricultural projects. Any unemployed agricultural graduate above the age of 22 years old is eligible for this loan.

    Secured unemployment loans- Secured unemployment loans are sanctioned against a collateral or security. In this loan scheme, the borrower pledges an asset to the lender based on which the lender sanctions the loan. The loan amount depends on the value of the asset pledged.


    LazyPay operates as a part of PayU offering instant personal financing facilities to customers. You can get a loan of up to Rs.1 lakh with LazyPay. In order to get a loan, you need to download the LazyPay app and apply.

    Benefits/Key highlights

    • Instant approval
    • Minimal documentation
    • Flexible repayment options


    SmartCoin is an app-based money lending platform targetted towards the middle- and lower-income strata. The interest rates offered by the lender are on the higher side because of the short loan tenure.

    Benefits/Key highlights

    • Paperless application process
    • Quick loan disbursal
    • Minimal documentation
    • Repeat loan facility available

    State Bank of India

    State Bank of India offers SBI Pension Loan to Central or State Government or Defence pensioners who draw their pension from any of the SBI branches.

    Benefits/Key highlights

    • High quantum of financing
    • Flexible repayment tenures
    • Competitive interest rates

    Punjab National Bank

    Punjab National Bank offers personal loans to pensioners who draw their pension through any of PNB’s branches. This loan can be taken to meet the medical expenses of pensioners during the time when they need it most. Borrowers can avail a loan multiple times based on the adjustment of the previous loan.

    Benefits/Key highlights

    • High quantum of financing
    • Attractive interest rates
    • Flexible tenures

    Other than the aforementioned loan schemes, you can also apply for the following schemes:

    Bank of India

    Bank of India offers BOI Star Pensioner Loan Scheme to a retired employee who draws a regular pension through the bank branch. The net pension of the applicant after the loan EMI is deducted should be at least 40% of the total pension amount.

    Benefits/Key highlights

    • High quantum of finance
    • One of the lowest interest rates on personal loans in India
    • Minimal documentation for processing

    Prime Minister's Rozgar Yojana (PMRY)

    This scheme aims to provide self-employment opportunities to the educated unemployed youth of the country. The scheme has undergone quite a few modifications over the years, including the relaxation of norms in the north-east region.

    Benefits/Key highlights

    • Loan for the unemployed between the age of 18 and 35 years
    • No collateral required for loans up to Rs.1 lakh
    • Preference will be given to women and weaker sections of the society, including SC, ST, or OBC applicants

    Pradhan Mantri Mudra Yojana (PMMY) Scheme for Women

    This is a loan scheme launched by the Government of India in 2015. This scheme allows women to avail a loan so that they can start a business venture of their own. There are various lenders and NBFCs in India who offer this particular loan scheme to its customers.

    Benefits/Key highlights

    • Loans are available under three categories – Shishu, Kishore, and Tarun
    • No collateral or security is required
    • Rates of interest levied is affordable
    • The repayment tenure under this particular loan scheme may go up to 7 years
    • A woman entrepreneur may avail this loan for working capital requirements

    Penalties and Internal Charges

    LazyPay Personal Loan

    Processing fee 2% of the loan amount
    Prepayment charges Not applicable, as prepayment is not supported
    Late fee Rs.10 per day

    State Bank of India Pension Loan

    Processing fee 0% to 5% of the loan amount plus GST
    Prepayment charges 3% of the prepaid loan amount

    Punjab National Bank Personal Loan to Pensioners

    Processing fee Nil
    Prepayment charges Nil
    Documentation charges Up to Rs.450 plus GST

    Bank of India Star Pensioner Loan Scheme

    Processing fee Up to 2% of the loan amount
    Prepayment charges Nil

    Mudra loan scheme for Women

    Processing fee Up to 1.5% of the loan amount
    Prepayment charges May differ from lender to lender

    Eligibility:You need to be a minimum of 18 years of age to apply for such loans.

    Documents required

    The documents you need to provide may include:

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

    Things to consider

    Before applying for a personal loan, here are a few things you need to keep in mind:

    • The advertised interest rate may differ from the final rate offered and is at the sole discretion of the bank.
    • Defaulting on such loans may result in high penal charges.
    • Calculate the EMI through an online EMI calculator to know the monthly instalment amount.
    • Ensure that you have enough funds to make timely repayments.

    Advantages of secured unemployment loan

    • Lower interest rates
    • Flexible loan repayment terms
    • Long term tenure
    • Smaller individual loan payments
    • Tax deductible interest

    Disadvantages of secured unemployment loan

    • Risk of possession of asset by the lender if the loan is not repaid in time.
    • The borrower should be the owner of the property that is being pledged.
    • Loan term is set by the lender.
    • More expensive in the longer run

    Unsecured loans- Unsecured loans is another way through which unemployed individuals in India can avail loans.Unlike secured loans, there is no need for collateral in unsecured loans and it comes with a higher rate of interest.A good credit history will increase the chances of availing unsecured loans in India.

    Loans for Unemployed FAQs

    1. How important is my Credit Score if I am looking to avail a loan for unemployed?
    2. Your credit score will play an extremely important role in you getting a loan. If you are unemployed, your credit score becomes extremely important. Higher your credit score, better your chances of getting a loan. There are lenders in India who do offer loans even if you have a low credit score. However, in these cases, the minimum credit score you may have to maintain is around 600. The credit score requirement will vary from lenders to lenders.

    3. I want a personal loan. Should I get a co-applicant?
    4. Yes, since the bank may not be willing to offer you a loan if you are unemployed. The bank takes into consideration your occupation and annual income as it helps them determine the rate of interest, they should levy on your loan amount and whether you will be able to repay the loan back in time. Hence, it is always a good idea to have someone as your co-applicant who will take the responsibility on your behalf to repay the loan. Your co-applicant should be someone you trust most preferably from your family such as your parents, siblings, spouse, etc.

    5. Are there loans which I can avail against collateral?
    6. Yes, there are loans which you can avail against collaterals. For example, if you own a property, then you can avail a personal loan where you pledge your property as collateral. Similarly, you can pledge your bonds, stocks, and even your FD returns which would help you avail a loan. You can also avail a gold loan if you have gold to pledge as security.

    7. Should I look to avail a loan from the bank in which I hold an account if I am unemployed?
    8. Regardless of whether you are employed or not, if you are looking for a loan, then it is always recommended that you visit the bank in which you hold an account. Your relationship with your bank goes a long way. Since you are a customer, the bank will surely look to help you avail a loan and recommend ways through which you can repay the loan in time even if you are unemployed.

    9. What are the things I must keep in mind before availing a loan and if I am unemployed?
    10. The first step is to identify the reason why you would need a loan in the first place. Availing a loan means accruing debt which you cannot afford if you are unemployed. Hence, you must avail a loan which you can repay in time and hence you must be specific regarding your loan amount and repayment amount.

      You must look to maintain your credit score, as good credit score means lower rates of interest which would help you repay the loan in time. Before you avail a loan, you must compare the various loan schemes available and select a scheme which you feel will be suitable for you and will also allow you to repay the loan without any delay.

    Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.

    This Page is BLOCKED as it is using Iframes.