Does your employment affect your Personal Loan eligibility?

4 MinsFeb 09, 2023

When you're looking to take out a personal loan, one of the most important factors that lenders will consider is your employment status and income. Both your employment and income play a crucial role in determining your eligibility for a personal loan and can affect the interest rate and terms of the loan.

Does your employment affect your Personal Loan eligibility?

How does employment affect your personal loan eligibility?

Lenders want to ensure that you have a steady source of income and can repay the loan before they approve your application. Below are some factors lenders generally look at concerning employment:

  • Steady income: Lenders typically prefer borrowers who have a steady income, such as a full-time job, and can provide proof of income through pay slips or tax returns. Self-employed individuals or those with variable or uncertain income may find it more difficult to secure a personal loan.
  • Credit history: Your credit history, including your credit score and credit report, will be evaluated by lenders. A good credit score and a positive credit history can improve your chances of getting approved for a personal loan.
  • Type of employment: Some lenders may consider the type of employment. For instance, some lenders may be more likely to approve loans for government or military employees, as they may view these jobs as more stable than others.
  • Length of employment: Lenders may be more likely to approve a loan for someone who has been in the same job for a longer period since they see it as an indication of stability.

Also Read: [How to get a Rs. 5 Lakh Personal Loan?]]

If you do not have proper employment for a personal loan, you may face several issues that can make it difficult for you to secure financing. Some of the issues that may arise include:

  • Difficulty getting approved: Without proper employment, lenders might not prefer granting you a personal loan, as they might view it as a risk to loan repayment.
  • Higher interest rates: If you get approved for a personal loan without proper employment, you may be charged higher interest rates, as the lender may see you as a higher-risk borrower.
  • Limited loan options: Without proper employment, you may have fewer loan options available to you, as compared to the masses.
  • Reduced loan amount: Lenders may be less willing to lend a large amount of money to someone with no proper employment, so you may only be able to get approved for a smaller loan amount than you had hoped for.

Each lender may have different requirements and criteria when evaluating personal loan applications. It is important to research the different options available and find the one that best suits your needs.


Your employment and income are significant factors that lenders will consider when evaluating your personal loan application. A stable job and income can increase your chances of getting approved for a loan and getting better interest rates. If you're looking for a personal loan, consider applying for one with Axis Bank, which offers a range of Personal Loan options with competitive interest rates and flexible repayment terms.

Want to calculate the monthly EMI on a personal loan? Check out Axis Bank's interactive personal loan EMI calculator & interest rates on personal loan

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.