Personal Loan for Government Employees
With the changing lifestyle of people, there has been a great demand for finance to fulfil growing aspirations. Personal Loans have become the most popular way to fund an array of requirements instantly. Personal Loans are unsecured loans that are given without any specifications of end use. This is the most convenient loan to resort to when in need of urgent funds. It can be used for just about anything. Be it medical emergencies, planning a wedding, planning a vacation, education expenses or for bridging the budget gap during the construction of a house or for the renovation of your existing house.
The availability of a technology platform to apply for these loans online such as MyMoneyMantra has made it even easier to avail the loan. There is no need to submit a pile of documents and make multiple visits to the financial institution for availing the loan. All you need to do is to furnish the required details online and upload soft copies of the necessary documents and it's done! If you satisfy the eligibility criteria, you will get instant approval and the loan will be disbursed within less than 2 days. The loan proceeds will be credited directly into your bank account.
Table of Personal Loan for Government Employees Contents
Special Schemes for Government Employees
Many banks have devised special Personal Loan schemes for Government Employees wherein the interest rates are lower than the regular Personal Loans. Concession in certain charges associated with Personal Loans like interest rates, processing charges, and pre-payment charges is also available.
Details of specialised Personal Loan scheme for Government Employees by some of the top banks are as enunciated below:
SBI Xpress Credit Personal Loan
Parameter | Features |
Eligibility |
|
Nature of facility |
Both term loan and overdraft facilities |
Purpose of loan |
No specific purpose defined. Can be used for just anything. Can be used for planning a wedding or a vacation, for medical emergencies, for the renovation of the house, for education expenses, and so on. |
Quantum of loan |
|
Margin |
Nil |
Collateral security |
No collateral security. This is the specialty of this loan |
Third party guarantee |
No third -party guarantee required |
Repayment |
Maximum 72 months or remaining service period (whichever is less) |
Interest rate |
The Interest is between 12% to 15% (as on 14.05.2019) |
Processing fee |
1% of the sanctioned loan amount + applicable GST |
Pre-payment charges |
|
Penal interest |
2% over and above the applicable interest on the overdue amount for the period of default. If part EMI is overdue then penal interest will not be levied. |
Other facilities |
|
Union Bank of India Special Personal Loan for Government Employees (SRLGE)
Parameter | Features |
Eligibility |
|
Nature of facility |
Both term loan and overdraft facilities |
Purpose of loan |
End-use for the loan is not restricted. It can be utilised for just about anything. |
Quantum of loan |
The maximum quantum of loan is 15 Lakhs depending on the repayment capacity. |
Margin |
Nil |
Collateral security |
No collateral security |
Third party guarantee |
|
Repayment |
|
Interest rate |
10.60% to 12.10% (as on 14.05.2019) |
Processing fee |
Nil |
Oriental Bank of Commerce Personal Loan Scheme for Government Employees
Parameters | Features |
Eligibility |
|
Nature of facility |
Term Loan |
Purpose of loan |
Can be utilised for any purpose like education, family function, wedding, travel, purchase of a gadget, renovation/repair of the home, medical emergency, and so on. There is no restriction on the end use, except that, it should not be used for speculative purposes. |
Quantum of loan |
Up to 15 times of the gross salary (maximum 10 Lakhs) |
Security |
Personal guarantee of a fellow employee with a restriction that one employee cannot stand as guarantor for more than 2 loan accounts. |
Margin |
Nil |
Interest rate |
11.50% p.a. (as on 14.05.2019) |
Penal interest rate |
2% above the normal interest will be charged on the overdue amount for the overdue period. |
Repayment |
Up to 60 months |
Processing fee |
0.50% of the sanctioned loan amount (minimum 500) + applicable taxes. |
Pre-payment charges |
Nil |
Axis Bank Personal Loan to Government Employees
Parameters | Features |
Eligibility |
|
Nature of facility |
Term Loan |
Quantum of loan |
Minimum 50,000 and maximum 15 Lakhs |
Purpose |
Can be used for any purpose as per the borrower's discretion. There is no restriction on end use. |
Security |
Unsecured loan. No security is required |
Margin |
Nil |
Interest rate |
Fixed Rate of Interest (as on 14.05.2019):
|
Penal interest rate |
2% on the overdue amount for the overdue period |
Pre-closure charge |
Nil |
Personal Loan for Defence Personnel
Earlier, it was difficult for the defence personnel to avail Personal Loans owing to their unpredictable postings. Since the operations in the bank account were manual in nature visiting the branch to conduct any transaction was mandatory. Now the whole scenario has changed and they will be able to access their account from any corner of the country.
With this development, defence personnel are now able to avail a Personal Loan. They are even offered special benefits like concession in interest rates and other charges stipulated by the bank.
The mandatory requirement for availing a loan is having their salary account with the bank from where they are availing the loan.
State Bank of India (SBI) and Union Bank of India, to name a few, are the banks that offer Personal Loans to defence personnel.
HDFC Bank is having a special loan scheme for defence personnel but SBI and Union Bank of India are offering Personal Loan to the defence personnel under the special scheme meant for Government Employees.
Union Bank of India is offering Personal Loan to defence personnel with the same features and benefits offered to other Government Employees.
State Bank of India is offering Personal Loan to defence personnel under their X-press Credit Scheme meant for Government Employees but with a difference. SBI is offering concession in rate of interest to Defence Personnel.
Documents Required for Personal Loans to Government/Defence Employees
- Personal Loan application form (duly filled and signed), along with 2 recent coloured passport-sized photographs.
- Income Tax Returns for the past 2 years
- Identity proof
- Proof of residential
- Proof of income/ pension (in case of pensioners)
- Defence personnel should submit a copy of ID card issued by the Department
Personal Loans to Pensioners
If you are a Central/State Government or defence pensioner and are below 76 years of age, then, you can avail Personal Loan from the bank where your pension is being credited.
The following is a list of banks, to name a few, who offer personal loans to pensioners. The features and benefits of the loan are as mentioned below:
SBI Pension Loan
Parameters | Features |
Purpose |
Can be used for any purpose like planning a wedding, for travel, for the purchase of a gadget, to meet medical emergencies, and so on. There is no restriction on usage. Can be utilised for any purpose as per the discretion of the borrower. |
Quantum of loan |
For Central/State Government Employees Minimum quantum available is 25,000 and maximum quantum equal to 18 months' pension with a ceiling in the amount as mentioned below:
For Defence Pensioners
EMI to Net Monthly Pension should not exceed 50% for both Central/State Government pensioners and defence pensioners. For Family Pensioners (including defence pensioners)
EMI to Net Monthly Pension should not exceed 33% of the pension for family pensioners. |
Repayment |
The repayment period is also fixed slab wise as per the age of the pensioner. For Central/State Government Employees
For Defence Pensioners
For Family Pensioners
Standing instruction to debit pension account to recover monthly EMI should be given in case of all pensioners. |
Margin |
Nil |
Guarantee |
Third party guarantee of a spouse eligible for family pension In the absence of a spouse, the guarantee of other family members or third party who is worth the loan amount. |
Processing charges |
|
Pre-payment charges |
For pre-payment and part- payment 3% of the outstanding liability will be collected. If the loan is closed before the term by the proceeds of another loan then no pre-payment charges will be applicable. |
Interest |
11.95% to 12.45% p.a. (as on 14.05.2019) |
Punjab National Bank Personal Loan to Pensioners
Parameters | Features |
Nature of facility |
Term Loan or overdraft |
Purpose |
No restrictions on end use of the loan. Can be used for any purpose as per the discretion of the borrower. |
Quantum of loan |
|
Repayment |
|
Margin |
Nil |
Interest |
For both Term Loan and Overdraft at 11.45% |
Guarantee |
Third party guarantee of spouse eligible for family pension or guarantee of children who are employed specifically, in a government department or any other person with means equal to or more than the loan amount. |
Processing charges |
Nil |
Documentation charges |
500 + applicable taxes |
Eligibility Criteria for Personal Loan to Pensioners
Like any other Personal Loan to individuals/self- employed professionals and non -professionals, even pensioners have to satisfy the eligibility criteria set out by the banks to qualify for the loan.
For Central and State Government Pensioners
- The age of the pensioner should not be more than 76 years and in the case of Vijaya Bank Pensioner loan, the age of the pensioner should not be more than 72 years.
- Pension should be credited to the account maintained at any one of the branches of the bank where the pension loan is availed.
- Pensioners whose pensions are disbursed by Government Treasuries by way of cheques drawn in favour of the bank branches as per the mandate of the pensioner are also eligible for the loan. In such cases, the original Pension Payment Order will remain in the custody of the Treasury and the pensioner gives a mandate to the Treasury for payment of pension through a particular branch of a bank.
Such pensioners should furnish an irrevocable mandate stating that they will not amend the mandate to the Treasury and the pension will be paid to the account in the bank branch till the pendency of the loan.
The Treasury concerned will consent in writing that it will not accept any request from the pensioner to transfer their pension payment to any other bank/branch till a No Objection Certificate is issued by the Bank.
For Defence Pensioners:
- Pensioners of Armed Forces, including Army, Navy and Air Force, Paramilitary Forces (CRPF, CISF, BSF, ITBP, etc.), Coast Guards, Rashtriya Rifles and Assam Rifles who's Pension Payment Order will be with the Bank.
- There is no minimum age stipulated. But the maximum age at the time of availing of the loan should be 76 years.
For Family Pensioners (including defence family pensioners)
Family pensioner i.e., spouse of the Pensioner who is authorised to receive the pension after the death of the pensioner, provided the family pensioner is not more than 76 years of age at the time of availing of the loan.
FAQs
✅ What are the eligibility criteria for a Personal Loan to Government Employees?
The eligibility criteria for a Personal Loan to Government Employees are as follows:
- Permanent/confirmed employees of State/Central Government Department, Quasi Government Department, PSUs and profit earning State PSUs.
- Teachers of government schools and colleges are also eligible for this loan
- The applicant should be in the age group between 18 years to 60 years
- Minimum Net Monthly income should be between 5,000 to 15,000 depending upon the bank where the loan is availed from.
- The EMI to Net Monthly income ratio after consolidating all the present commitments including the EMI of proposed loan should be between 30% to 50%, depending upon the bank from where the loan is availed.
- Salary account should be maintained at the bank where the loan is availed
✅ What is the repayment tenure available for the Personal Loan to Government Employees?
The repayment tenure available is typically between 12 months to 60 months.
✅ What is the turnaround for these Personal Loans?
With the facility of applying for the loan online available, the turnaround for these loans has drastically reduced. The loan will be disbursed within hours if all the details are furnished accurately.
✅ What are the purposes for which the loan can be utilised?
The loan can be utilised for any personal purpose like education expenses, marriage expenses, travel expenses, and for any medical emergencies. This unrestricted end use has made this product very popular.
✅ What is the best way to get a good deal on Personal Loan interest rate?
Banks consider applicants with a good credit score (700 or above) as low-risk borrowers. A good credit score indicates good management of funds and regular repayment of loans. If the credit score is good, negotiation for a good deal, in terms of interest rate can be done.
✅ What is the difference between a Personal Loan to government employees and a Personal Loan to defence personnel?
All the key features for both the loans are similar except that defence personnel get the loan at a concessional rate.
✅ What are the eligibility criteria for Personal Loan to pensioners?
- Central/State Government/Defence pensioners can apply for the Personal Loan
- Age of the pensioner should not be over 76 years
- The pension should be routed through the account maintained at the bank from where the loan is availed.
✅ What is the repayment tenure available for the Personal Loan for pensioners?
The repayment tenure is fixed depending upon the age of the pensioner:
- For pensioners below 56 years(defence pensioners): 84 months
- For pensioners above 56 years but = 72 years: 60 months
- For pensioners above 72 years but = 74 years: 48 months
- For pensioners above 74 years but = 76 years: 24 months