As an unsecured financing option requiring zero collateral, personal loan has fast captured the retail loan market of India. One of the indisputable indicators of its widespread popularity was illustrated during the recent economic slowdown where, despite an unbalanced financial health of citizens, the personal loan segment managed to maintain its streak of growth as against many other retail funding options whose growth stagnated.
Among other financial factors that make personal loans a viable funding option, their ease of availability has been a critical driver behind their growth. Combined with minimum personal loan documents required during application, these advances are easier to avail. Let’s take a look at the important documents needed during a personal loan application that you must submit.
List of Essential Documents Required for Personal Loan
Document requirement for personal loan under certain categories can vary with the occupational profile of an applicant, i.e. salaried or self-employed. Here are some of the common as well as standalone document requirements for any one applying for a personal loan.
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Duly filled application form
Individuals need to correctly fill up the application form when submitting the loan application, whereby the details mentioned in the form should be to the best of their knowledge. Some of the common details required to be filled up include personal, employment, and financial details. Keeping all the information provided correct ensures that the application goes through a smooth processing.
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Identity proof
Personal loan documents required as identity proof include any government-issued proof with the individual’s name and photograph. They primarily include PAN card, Voter ID card, Aadhaar card, Passport, Driving License, etc.
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Address proof
Proof of permanent and/current residence for personal loan application includes Aadhaar card, Voter ID card, Passport, Ration card, and utility bills like electricity bill, gas bill, water bill, etc. For individuals residing in a rented house, a rent agreement with the landlord’s signature also serves as a valid proof. Other valid documents include passbook, house registration certificate, etc.
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Income and financial proof
Income and financial proof differs based on the occupational profile of an applicant, and includes the following.
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For salaried
Salary slips for three previous months, Form 16 declaring his/her income, bank account statements for last three months, and ITR filed for one previous year form as sufficient proofs of income for salaried individuals.
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For self-employed
In the case of self-employed applicants, income proof include bank account statements for six previous months, ITR filed for two previous years, minimum annual turnover for the business and financial statements like balance sheet, profit and loss statement.
Alongside, self-employed individuals also need to provide proof of business existence and years of operation, which can include registration certificate, incorporation certificate, GST registration certificate, etc.
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Photograph
At last, one must also provide a proof of facial recognition through one or two passport size photographs, which also serve for the lender’s record of borrower.
Once you have all the personal loan documents required in place, you can proceed to apply for the advance with your selected lender. Note that documents are way to establish your eligibility for the loan, which makes it essential that you go through all eligibility criteria and fulfil them before applying for improved chances of hassle-free approval.
