If you’re struggling with a low credit score, you’re not alone. Thousands of Indians face rejection when applying for personal loans due to poor or insufficient credit history. But here’s the truth: getting a personal loan with a low CIBIL score is possible—if you know where to look and how to apply strategically.
In this 2025 guide, we’ll explain how to secure a personal loan despite a low score, which lenders might consider your application, what terms to expect, and how to avoid high-interest traps.
🔍 What Is a Low Credit Score?
Your CIBIL score (or credit score) is a 3-digit number ranging from 300 to 900, used by lenders to assess your creditworthiness. Here’s a quick breakdown:
- 750 – 900: Excellent – High approval chances
- 700 – 749: Good – Likely to be approved
- 650 – 699: Average – Possible, but fewer options
- 600 – 649: Low – Difficult but not impossible
- Below 600: Poor – High risk for lenders
If your score is below 650, most traditional banks will hesitate to approve your personal loan application. However, some NBFCs and fintech lenders may still consider you.
📝 Can You Get a Personal Loan with a Low Credit Score?
Yes, you can. While banks like HDFC, ICICI, or SBI often require a credit score of 700+, many non-banking financial companies (NBFCs) and digital lenders in India cater to individuals with scores below 650. However, there’s a catch:
- Interest rates may be higher
- Loan amount may be lower
- Loan tenure may be shorter
- You may need to provide collateral or get a guarantor
Still, if you’re in urgent need—be it medical expenses, home repair, or wedding—you have options.
✅ Eligibility Criteria for Low CIBIL Score Personal Loans
Even with a low credit score, you can still qualify for a personal loan if you meet some of the following criteria:
| Criteria | Details |
|---|---|
| Stable Income | Salaried or self-employed individuals with steady monthly income are preferred. |
| Job Continuity | At least 1 year of work experience, preferably with the same employer. |
| Low Existing Debt | Minimal ongoing EMIs improve your chances. |
| Age | Typically between 21 and 60 years. |
| City | Urban and Tier-1 cities may have more lender options. |
🏦 Top Lenders Offering Personal Loans for Low Credit Score (2025)
Here are some NBFCs and digital lending platforms in India that offer personal loans to individuals with low CIBIL scores:
1. MoneyTap
- CIBIL Score Required: 600+
- Loan Amount: ₹3,000 – ₹5,00,000
- Interest Rate: 13% – 24% p.a.
- Tenure: 2 to 36 months
2. EarlySalary
- CIBIL Score Required: 600+
- Loan Amount: ₹5,000 – ₹5,00,000
- Interest Rate: 18% – 30%
- Tenure: 3 to 24 months
3. Bajaj Finserv
- CIBIL Score Required: 650+
- Loan Amount: Up to ₹25 lakhs
- Interest Rate: 12% – 28%
- Tenure: Up to 60 months
4. CASHe
- CIBIL Score: Not mandatory
- Loan Amount: ₹7,000 – ₹4,00,000
- Tenure: 90 to 360 days
5. PaySense
- CIBIL Score Required: 580+
- Loan Amount: ₹5,000 – ₹5,00,000
- Tenure: 3 to 60 months
💡 Tip: Always compare interest rates, processing fees, and penalties before finalizing a lender.
📉 Risks of Taking a Loan with Poor Credit
Although personal loans can help in urgent situations, borrowers with low credit scores face certain risks:
- Higher Interest Rates: Lenders charge more to offset the risk.
- Hidden Charges: Look out for processing fees, prepayment penalties, and insurance add-ons.
- Shorter Loan Tenure: EMIs may be higher due to a shorter repayment period.
- Debt Trap Risk: Taking a high-interest loan without the ability to repay may worsen your credit further.
📈 How to Improve Your Chances of Loan Approval
If your score is below 650, try these strategies to increase your chances:
1. Apply with a Co-Applicant
Having a co-applicant with a good credit score can improve your chances significantly.
2. Show Proof of Additional Income
Freelance work, side hustles, or rental income can strengthen your profile.
3. Apply for a Lower Loan Amount
Smaller loans are less risky for lenders and more likely to get approved.
4. Pledge Collateral (Secured Loan)
If you own assets like gold, FD, or property, go for a secured personal loan.
5. Avoid Multiple Applications
Each loan rejection further lowers your score. Apply only where you’re likely to qualify.
📊 Real Example: Ajay’s Journey from 620 Score to Loan Approval
Ajay, a 30-year-old salaried employee in Pune, was rejected by two banks due to a CIBIL score of 620. He needed ₹1.5 lakhs for emergency surgery. Here’s what he did:
- Checked his credit report for errors and corrected them.
- Chose PaySense, a digital lender with flexible score requirements.
- Submitted salary slips and added his wife as a co-applicant.
- Got the loan within 3 days at 21% interest.
Later, he used the loan responsibly, paid EMIs on time, and increased his score to 690 in 7 months.
💡 Bonus: Use Loan to Improve Your Credit Score
Did you know that taking a personal loan and repaying it responsibly is one of the fastest ways to build your credit score?
Here’s how:
- Make on-time EMI payments without fail.
- Keep your credit utilization below 30%.
- Don’t close old accounts—longer credit history helps.
- Don’t apply for multiple loans/credit cards simultaneously.
Within 6–12 months, your score could improve dramatically, opening doors to better loans and credit cards.
🛑 What to Avoid While Seeking Loans with Low Score
- Loan sharks or unregistered apps: These may charge 100–300% interest and harass borrowers.
- Fake credit repair companies: Only CIBIL or RBI-approved agencies can make changes.
- Multiple loan apps at once: This lowers your score further.
Always stick to RBI-regulated lenders and compare your options before applying.
🧾 Documents Required for Personal Loan with Low Score
Here’s a general list:
- PAN Card
- Aadhar Card
- Bank Statement (Last 6 months)
- Salary Slips or Income Proof
- Passport-size Photo
- Address Proof
Some lenders may ask for post-dated cheques or signed ECS mandates.
📌 Final Thoughts: Should You Take a Personal Loan with a Low Credit Score?
Taking a loan with a low credit score should be a last resort, not a first option. If it’s a medical emergency or unavoidable need, go ahead—but choose your lender wisely. Use the opportunity to rebuild your credit by paying on time and maintaining discipline.
In the long run, focus on improving your score with responsible financial behavior. A better score gives you access to lower interest rates, higher loan amounts, and financial freedom.
🔁 Quick Recap
| Step | Action |
|---|---|
| 1 | Understand your credit score |
| 2 | Check your credit report for errors |
| 3 | Apply with trusted lenders (NBFCs or fintechs) |
| 4 | Choose low loan amount and short tenure |
| 5 | Repay EMIs on time to boost score |
📥 Ready to Apply?
Check your latest CIBIL score and explore trusted loan options right on ImproveCIBIL.com. Need help choosing a lender? Leave a comment or contact us!