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Need a Personal Loan But Got Refused Everywhere? Here’s What to Do

Updated on: 14 Dec 2021 // 20 min read // Personal Loans
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You are in need of money urgently to meet your personal needs or to meet a monetary shortfall. So, you applied for Personal Loan and you were hoping for a positive response from the bank. But you have been refused a loan! You didn’t expect that rejection.

BanksInterest rate (%)Processing fee
Allahabad Bank8.55% – 13.05%1.06% of loan amount (Minimum Rs. 1068)
Andhra BankClean Loans: 11.70% – 13.20%Not available
Bank of Baroda11.55% – 16.55%2% of Loan amount (Minimum: Rs.1000 to Maximum Rs.10,000)
Bank of India12.10% – 14.10%up to 2% of loan amount (Minimum Rs.1000 to Maximum
Rs.10,000)
Bank of Maharashtra11.50% – 12.50%1% of the Loan Amount (Min.:Rs.1000)
Canara Bank11% – 14%0.5% of the loan amount (Minimum Rs.1000 and Maximum Rs. 5000)
Central Bank of India11.60%Rs. 500 + S.T
Corporation Bank12.85% – 13.85%1.50% (Min. of Rs. 500)
Dena Bank13% – 14%1% of loan amount
IDBI Bank Limited10% – 12.75%up to 1% of the loan amount + applicable taxes
Indian Bank10.65% – 11.25%0.51% on loan amount with a max. of Rs. 510
Indian Overseas Bank11.95% – 13.70%0.50% (Upto Rs. 5,00,000)
0.75% (Above Rs. 5.00.000)
Oriental Bank of Commerce10.25% – 12.25%0.50% of the loan amount with a minimum of Rs. 500 + Service tax, if any
Punjab & Sind Bank12.80% – 14.05%1% of the loan amount
Punjab National Bank12.05% – 15.05%1.80% of loan amount (Rs. 270 – Rs. 450)
State Bank of India11% – 17.05%up to 1% of the Loan amount
Syndicate Bank12.65% – 13.65%0.50% of the Loan amount with minimum of ` 500
UCO Bank11.40% – 11.65%1% of loan amount (minimum Rs.750)
Union Bank of India13.65%0.50% of the loan amount, subject to minimum of Rs. 500, plus applicable GST.
United Bank of India13.95% – 14.20%1% of the loan amount sanctioned
Vijaya Bank12.55% – 13.55%Processing charges: up to 0.75% of loan amount + GST.
Axis Bank Ltd.15.75% to 24%1.50%-2.00%+GST
Bandhan Bank Ltd.15%-18.55%1%+GST
Catholic Syrian Bank Ltd.12%-19%1% of loan amount subject to minimum of Rs.250
City Union Bank Ltd.No Information available on websiteNo Information available on website
DCB Bank Ltd.They do not provide PLThey do not provide PL
Dhanlaxmi Bank Ltd.10.40%-10.90%Upto 2.5% of loan amount subject to minimum of Rs.1250
Federal Bank Ltd.11.49%-14.49%0.50% of loan amount subject to minimum of Rs.500
HDFC Bank Ltd11.25%-20%Upto 2.5% of loan amount subject to minimum of Rs.1999
ICICI Bank Ltd.10.99%-22%Upto 2.25% of loan amount+GST
IndusInd Bank Ltd10.50%-30.50%Upto 2.5% of loan amount subject to minimum of Rs.1000 plus taxes
IDFC Bank Ltd.Rates not available on website (As per our info- 10.99%-15%)Upto 2% of loan amount
Jammu & Kashmir Bank Ltd.They provide Consumer LoansThey provide Consumer Loans
Karnataka Bank Ltd.12.70%0.50% of loan amount subject to minimum of Rs.250
Karur Vysya Bank Ltd.15.90%0.40% of loan amount
Kotak Mahindra Bank Ltd10.99%-24%Upto 2.5% of loan amount+GST
Lakshmi Vilas Bank Ltd.Do not provide Personal Loan 
Nainital bank Ltd.Website not updated 
RBL Bank Ltd.11%-26.25%Upto 2.5% of loan amount
South Indian Bank Ltd.11.55%-14.45%2% of loan amount
Tamilnad Mercantile Bank Ltd.14.80%1% of loan amount
YES Bank Ltd.11.25%-17.5%Upto 2.5% of loan amount subject to minimum of Rs.999

Your Personal Loan rejection reasons may be one, few or all of the following:

1. Insufficient income: As there is no security involved, lenders will consider your repayment capacity. If you don’t have a stable income and if it is low, you will be refused loans everywhere.

2. If you are over-leveraged: If you have taken other loans and your income is insufficient to repay more than one loan, you could be denied a loan.

3. Not having a stable job and persistent job: Hopping from one job to another may discourage the lender from offering you a loan.

4. If you have applied for a loan several times in the past: Doing this may affect your current application. Numerous loan inquiries create a bad credit score.

5. If you have not given a valid purpose of availing finance, your loan request may be declined.

6. If your income is good and you have taken other loans, but have defaulted on payments, you may face rejection. Other factors for a bad credit score include skipping EMIs, paying EMIs late, late payment of credit card bills, etc.

7. If you have taken too much loan during the last 12 months, your application may be rejected even if you have an excellent credit score.

8. Previous loan rejections also reflect on your credit history. This may affect your current application.

9. Do you have an excellent credit score, but refused a loan? This may result due to the furnishing of wrong information. Before providing finance, lenders do verify all the information you provide.

10. If you have a record of frequently changing your permanent address, your application may get rejected.

11. If you have been a loan guarantor to a repayment defaulter, it will have a negative impact on your credit score. In such a situation even if you have an excellent credit score, you will still be refused a loan.

Besides the aforementioned Personal Loan rejection reasons, there may be other factors that may result in rejection of an application.

Apply for Personal Loan

To ensure that you are not refused loans everywhere, consider the following:

  1. Check your eligibility criteria before you apply so that you won’t be refused a loan.
  2. Submit a statement of your savings and investments.
  3. Do not submit any false documents.
  4. Never default on repayments if you have already taken other loans.
  5. Pay your credit card bills and other payments on time.
  6. Do not avoid verification calls from your bank where you have apply for a Personal Loan.
  7. Ensure that your residential address doesn’t match with that of a defaulter.
  8. Avoid being a loan guarantor. If you have to, read this first: Stop! Read This Before Signing Up as a Home Loan Guarantor 
  9. Do not unnecessarily apply for loans several times.
  10. Apply for a loan only if you have a good credit score.
  11. Before applying, ensure that you have a stable source of income.

To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.

Apply for a Personal Loan