Worried about your low credit score? You’re not alone. Many people face loan rejections just because their credit score is below 700. But the good news is that getting a personal loan with a low credit score is still possible in 2025. Several banks, NBFCs, and fintech lenders now offer instant personal loans even to those with poor credit history — though at slightly higher interest rates. Let’s understand how you can get approved and which options are best for you.
What is a Low Credit Score and Why It Matters
A credit score below 650 is generally considered low. It signals higher risk to lenders, which makes them cautious. This may lead to limited loan amounts, higher interest rates, or additional documentation requirements. However, if you show stable income and repayment capacity, many lenders are willing to offer personal loans despite a weak CIBIL score.
How to Get a Personal Loan with a Low Credit Score
Here are some smart ways to increase your chances of approval:
- Show Strong Income Proof: Submit bank statements, ITR, and business records to prove consistent cash flow.
- Apply for a Smaller Amount: Lenders are more comfortable approving smaller loans for low-score borrowers.
- Add a Co-Applicant: A guarantor with a good credit profile improves your eligibility.
- Offer Collateral: Securing the loan against a fixed deposit, gold, or property reduces lender risk.
- Choose NBFCs or Fintech Lenders: Platforms like Bajaj Finserv, Shriram Finance, and Airtel Finance often approve loans for lower CIBIL scores.
- Repay Existing Debts: Paying off old loans improves your credit score quickly and boosts approval chances.
Interest Rates and Loan Terms
Interest rates for low-credit-score personal loans are usually higher than regular ones. Here’s what you can expect in 2025:
- Interest Rate: Starts from 12% p.a. and may go up to 24% depending on your profile.
- Loan Amount: ₹50,000 to ₹10 lakh (varies by lender).
- Tenure: 12 to 60 months with flexible EMI options.
- Processing Time: Instant online approval for pre-verified profiles, within 24–48 hours for others.
Banks like ICICI Bank, YES Bank, and Kotak Mahindra Bank consider applications with CIBIL scores as low as 600, provided you have stable income and clear repayment history in the past few months.
Things to Keep in Mind
Always compare interest rates, processing fees, and prepayment charges before choosing a lender. Avoid applying to multiple banks at once, as each inquiry can further lower your credit score. Read all terms carefully, especially if the lender advertises “no credit check” loans, since these often come with strict repayment conditions.
Conclusion: Even with a low credit score, you can still get a personal loan in 2025 by proving your repayment ability and maintaining transparent documentation. Choose lenders that specialize in low-score personal loans, start with smaller amounts, and make timely repayments to rebuild your credit for future loans.
Disclaimer: The information provided in this article is for general awareness only. Loan approval, interest rates, and eligibility criteria vary based on individual credit history and lender policy. Always verify the latest terms from the bank or NBFC before applying.