low cibil score loan: Borrowing money has become an inevitability for many people. In one way or the other, whether it is buying a home, paying for children’s college fees or for personal use, taking a loan is a must. Yet, the most important factor in getting any loan is your CIBIL score. What if your CIBIL score is poor or zero? Is it possible to get a loan? The answer is yes. In this article, we are going to explain how you can get a loan of around ₹100,000 using only your Aadhaar card, even if your CIBIL score is zero or poor.
Low Cibil Score Loan: What Is It?
A low Cibil score loan refers to a loan that an individual can obtain despite having a low or poor Cibil score. The Cibil score is a number that represents your credit history. A score between 300 and 900 is considered good, while a score below 300 is seen as poor.
What is a CIBIL Score?
CIBIL score reflects a summary of a person’s credit repayment history and also tells how well he has managed credit or loans in the past. This score usually ranges between 300-900 and CIBIL, a credit information company, assigns such a score. A score above 750 is considered favourable and thus it is easier to get a loan.
However, people with a score less than or equal to 750 may face challenges in getting loan approval.
What is a Zero CIBIL Score?
A CIBIL score of zero signifies that there is no record of borrowing. This is most common for persons who are trying to obtain a loan or credit card for the very first time. In those cases, the CIBIL score may be reported as NA (Not Available) or N/A which means they have no credit history. This is a disadvantage since it may be difficult to get a loan because banks or financial institutions have no way of determining your loan repayment ability.
Why is it Hard to Get a Loan with a Bad CIBIL Score?
CIBIL score, which indicates how well you have repaid any previous loans or even credit cards, is an important factor that banks or financial institutions have to analyze before sanctioning a loan. For instance, if you have skipped some payments that resulted in very high debts, there is a possibility that your score is going to be low. This makes the lender believe that you might also default on repaying this new loan, resulting in denial of your loan application.
On the upside, a number of commercial banks and non-banking financial institutions have also introduced some loan facilities for individuals with no credit history, or even a negative CIBIL score.
How Can You Get a Loan with Just an Aadhaar Card?
Obtaining a loan by merely presenting an Aadhaar card is no longer a tug of war. The inordinate amount of documents which were required earlier is no more a necessity. Various banks have now come up with a loan against only one Aadhaar card even on the internet. Usually when one has to take a loan he/she is required to provide the following documents;
- Proof of Identity: Aadhaar card, PAN card
- Proof of Address: Electricity bill, water bill, Aadhaar card
- Income Proof: Bank statement, salary slip
- Employment Proof: Experience certificate, appointment letter (if applicable)
Which Banks and Financial Companies Provide Loans with a Zero CIBIL Score?
Dostępne są kredyty osobom z niskim oraz zerowym CIBIL, a takie możliwości daje jedynie Union Bank. W większości przypadków jednak to podejście dotyczy tylko ofert dla osób już od jakiegoś czasu klientom danej instytucji. In case you have a Union Bank account with a healthy transaction record, applying for a loan via their service will be a piece of cake.
1. Union Bank
Union Bank happens to be one of the handful of banks which dispense the services such as loans to people with a poor or a nil CIBIL score. Nonetheless, this service is almost always extended to the loyal customers of the bank. In case you have the account with Union Bank along with the sound conduct of transactions, obtaining the loan with them will not be an issue.
2. Bajaj Finserv
Bajaj Finserv is a major player in the financial services sector, which, unlike many, does not completely depend on CIBIL scores to sanction loans. They assess the applicant’s earning, job status, and other parameters before sanctioning the loan. Personal loans can also be availed of through Bajaj Finserv, in case the CIBIL score is very low or even nil.
3. Hero Fincorp
Hero Fincorp is yet another financing company which offers loans to borrowers having no or very low CIBIL scores. Loans can be requested with basic documentation including, among others, the Aadhaar card and other necessary documentation.
How to Apply for a Loan with Zero CIBIL Score?
Loan Approval: After reviewing your application, the bank or financial institution will approve your loan, and the loan amount will be credited to your bank account.
Download the App: First, download the official application of the bank or financial institution from which you want to take the loan.
Upload Documents: Through the app, upload your identity, address, income, and employment documents. Ensure that all documents are up-to-date and accurate.
Fill in the Details: Enter all the required personal and loan-related information in the app. This includes your contact details, loan amount, and other necessary information.
Submit the Application: Once all the information is filled in and the documents are uploaded, submit the application.
Eligibility Criteria for Getting a Loan with Zero CIBIL Score
Even with a zero or low CIBIL score, there are steps which one has to follow to obtain a loan. These steps may be specific to any bank or financial institution but in general involve:
- Age: You must be at least twenty-one years of age to be eligible for a loan application. Certain organizations may issue loans to persons of eighteen years and older however, twenty-one is the most commonly used age threshold.
- Minimum Monthly Income: Your monthly income should be at least ₹15,000 to ₹20,000, depending on the loan provider.
- Indian Citizenship: You are required to be an Indian citizen. Although there are special provisions made in loan schemes for Non-Resident Indians (NRIs) many of the zero CIBIL score loans are provided only to Indian residents.
- Stable Income: It is crucial for you to have a steady source of income, employment, self-employment or a running business that you can use to demonstrate your loan repayment capacity.
Is it Safe to Take a Loan with Zero CIBIL Score?
Borrowing money when you have a CIBIL score of 0 seems quite safe if you apply through good and dependable sources. Nevertheless, some precautions are there for you to take so that you do not get into a financial mess:
- Choose Reputable Institutions: Apply for loans only through well-known banks or financial institutions.
- Read Online Reviews: Before choosing a loan app or financial platform, read online reviews to understand how trustworthy they are.
- Check for Hidden Charges: Always carefully read the terms and conditions, including the interest rates and any hidden charges. High-interest rates can lead to heavy financial burdens in the future.
Common Reasons for Loan Rejection
- Incomplete Information:It is probable that your loan application should you provide either missing or erroneous details will be turned down..
- Low Income:Should your monthly wages fall short of the required minimum eligibility levels, your loan request shall be turned down.
- Unstable Job: In case your job security is not guaranteed, or you lack a steady source of income, securing loan approval might not be easy.
Conclusion
While CIBIL score plays a crucial role in loan approval, it doesn’t mean that having a zero or poor score will completely prevent you from getting a loan. With the right information and documents, you can easily secure a loan even with a zero CIBIL score. In this article, we explained how you can obtain a loan of up to ₹100,000 using just your Aadhaar card and other necessary documents, regardless of your CIBIL score.
If you found this information helpful, please let us know in the comments. Feel free to reach out to us for any further assistance.