Personal Loan for Government Employees: Features, Interest Rates and Eligibility
A government personal loan scheme is a type of personal loan specifically designed for central and state government employees. Government employees can apply for this scheme to take care of sudden financial emergencies. If you’re a government employee, you can take personal loans up to ₹40 lakh at interest rates starting from 8% p.a. for a tenure of up to 7 years.
This blog talks about everything you need to know about a government personal loan scheme, including interest rates, fees, eligibility and documents required.
What is a Government Personal Loan Scheme?
Government Personal Loan Scheme is specifically curated for permanent Central and State Govt. employees. Government employees can apply for this scheme to take care of sudden financial emergencies.
Features and Benefits of Government Personal Loan Scheme
Here are some of the features and benefits of government personal loan scheme:
1. 100% Paperless Process
Lending sector has evolved by leaps and beyonds in the last few years, thanks to the deployment of advanced tech in the banking system. Most RBI-approved lenders offering loans via apps provide loans in a 100% paperless manner.
2. Instant Disbursal
Expect instant disbursal if your loan application is approved by the lender. For instance, you can get a loan with Navi within a few minutes, provided you’re eligible.
3. Flexible EMI
Personal loans come with flexible repayment tenures, usually extending up to 84 months. You have the freedom to select the loan tenure as per your convenience.
4. Attractive Interest Rates
Do you have an excellent repayment history or credit score? Lenders offer preferential rates to customers with proven creditworthiness.
5. No Collateral Required
Unlike home loans, for personal loans you don’t have to pledge collateral or guarantor. Also, that’s one of the primary reasons why personal loans usually have higher interest rates than home loans.
6. Minimal Documentation
Thanks to advancements in the lending sector, you don’t have to fill out a bagful of documents. Lenders mostly ask for your address and ID proof, and at times, income proof as primary documents.
How to Apply for Personal Loan?
You can follow the steps below to apply for a government personal loan:
Step 1: Go to the website or download the personal loan app from Play Store or App Store.
Step 2: Check your loan eligibility by filling in some details such as name, address and PAN details.
Step 3: Check the interest rate offered and enter your preferred loan amount and repayment tenure.
Step 4: Submit or upload the necessary documents and complete your KYC process.
Step 5: Link your bank account. After successful verification, the loan amount will be directly disbursed to your account. Set up an auto debit to make your loan repayments on time.
Documents Required
Here are the documents that you may require to apply for a government personal loan:
- PAN Card
- Aadhaar Card
- 3-6 months bank statements or salary slips
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Eligibility Criteria
Here are the eligibility criteria to apply for the Government personal loan scheme:
| Factors | Eligibility Criteria |
| Age | Between 18 and 65 years |
| Credit Score | 750 or above |
| Employment Stability | Must be a State or Central Government employee. |
| Employment Duration | A minimum of 1 year |
Interest Rate and Other Fees on Government Personal Loan Scheme
The interest rate and other applicable fees on Government Personal Loan Scheme is in the following table:
| Interest Rate | 8% p.a. – 36% p.a. |
| Processing Fee | 0% – 4% of the loan amount |
| Loan Amount | Up to ₹40 lakh |
| Loan Tenure | Up to 84 months |
| Prepayment Charges | 0% to 4% |
Please note that the table is for educational purposes only. Navi doesn’t take any responsibility for the accuracy of the data presented in the table.
Calculate EMI on Your Personal Loan
Here is the formula for manual calculation of EMI of a personal loan:
EMI = P × r × (1 + r)n/((1 + r)n – 1) where P is the loan amount, r is rate of interest, and n is tenure or the number of months.
However, manual calculation can get confusing and tiresome. Instead, you can get more accurate results within minutes with our online personal loan EMI calculator. Just enter the loan tenure, loan amount and interest rate to know the EMI within a few seconds.
Calculate Your Personal Loan EMI
Loan Amount
Rate of Interest (P.a)
%
Loan Tenure (Years)
Years
Monthly EMI
0
Total Interest
Total Amount
Various Types of Personal Loan
Here are the types of personal loans:
1. Marriage Loan
No need to compromise on your dream wedding or honeymoon. Apply for instant personal loan for marriage and enjoy your dream wedding without any inhibitions.
2. Travel Loan
Tired of postponing your vacation for a long time due to shortage of funds? Apply for instant personal loan for travel and plan for your trip today!
3. Car Loan
Having a car makes commuting a lot easier. Apply for an instant personal loan for car and travel anywhere in or out of your city hassle-free.
4. Bike Loan
In case you’re planning to buy a bike but don’t have enough funds to make the down payment, you can take a personal loan for two wheeler. Enjoy flexible repayment options and attractive interest rates.
5. Second Hand Bike Loan
Falling short of funds to purchase a second-hand bike? Take a personal loan and purchase a second-hand bike with minimal documentation and enjoy the joyride.
6. Used Car Loan
Not planning to heavily invest in a new car? Purchase a second-hand car. In case you’re falling short on funds, get a personal loan for used car. Enjoy instant disbursal with minimal paperwork.
Final Word
Government personal loan schemes are basically just like any other personal loan. However, certain lenders offer lower interest rates, reduced processing fees, etc., for certain categories of government employees.
Want quick access to cash? Apply for Navi Cash Loan and get instant access to funds of up to ₹20 lakh. Choose the repayment tenure as per your preference and repay in easy EMIs. Download the Navi app today!
FAQs
Ans: The following are some additional charges for a personal loan:
1. Processing fees: Usually 1-3% payable for processing a loan application.
2. Loan cancellation charges: Charges vary from one financial institution to another
3. Prepayment charges: 2%-5% of the outstanding loan amount
4. EMI payment bounce charges: From Rs. 300 to Rs. 500 for the failure of deduction of stipulated EMI
Ans: When availing of a personal loan, you will want to maintain a credit score of at least 750 as it determines your creditworthiness and, thus, the likelihood of loan repayment. A lower credit score signifies bad debt management, which could lead to higher interest rates applicable on your loan or outright rejection.
Ans: Salaried employees need to have a regular source of income and be employed for at least six months to apply for a personal loan. Most financial institutions offer a loan amount on which EMIs will not exceed 40-50% of your monthly income.
Ans: Personal loans usually come with short tenures as they are meant to be repaid in a short period. In India, personal loans have a tenure of 12 to 60 months, though some financial institutions offer flexible tenures of up to 84 months.
Ans: Many parents take a personal loan for their children’s education as they often have the financial stability to get a loan sanctioned. Once the child completes his/her higher education and gets employed, the loan can be transferred for him/her to pay.
Ans: In normal circumstances, most financial institutions disburse the loan amount within 24 hours of approval. The actual loan amount that you will receive depends on the terms and conditions of your loan agreement.
Before you go…
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Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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