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Can I Get a Personal Loan with a Low CIBIL Score?

By Finserv MARKETS - Dec 25,2019
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The Credit Information Bureau (India) Limited (CIBIL) score plays a pivotal role when it comes to applying for a Personal Loan. As per CIBIL, around 79% of loans or credit cards usually get approved by the majority of lenders if individuals have a score greater than 750. Since personal loans are ‘unsecured’, i.e. typically without any collateral securities, many lenders depend on the creditworthiness of the applicant. Therefore, a borrower with a low credit score is considered as a ‘high credit risk’ with poor creditworthiness. That said, your creditworthiness hinges on the payment behaviour of your loan. It depends on the type of credit you are using, which can be either your existing loans or a balanced mix of loans as well as credit cards. Further, your credit score is also evaluated on the timely repayment of loans.

If you have a low credit score, your application for a personal loan may not be accepted by the banks. However, there are some co-operative banks and financial institutions that provide loans despite low credit score. However, such loans typically come with higher interest rates and lower loan amounts.

Additionally, there are a few steps that you can take to increase your chances of obtaining a personal loan, even with a low CIBIL score:

  • Start with a lower personal loan amount:

There is a high chance of being rejected by the lender, while asking for a high loan amount with a lower CIBIL score. A high loan amount with a lower credit score signals more risk for the financial institution, and indicates that there may be a likely default on repayment time. On the other hand, asking for a lower personal loan amount not only gives the lender more confidence in granting the loan but also makes it is easier for you to repay. There are a variety of options at hand for you to choose from. For instance, you can consider the Personal Loans of up to Rs. 25 Lakhs available on Finserv MARKETS, which come with lightning quick disbursals and attractive interest rates. With minimal paperwork, you can opt for a personal loan with a lower amount, right from the comfort of your home.

  • Prove your financial capabilities:

As an applicant, you have to communicate to the lender your financial capabilities when it comes to the timely repayment of your EMI payments. There are various ways like disclosing your steady income (including salary, rent, any commission, etc), to convince the lender of your financial capabilities and that you would make timely payments of your EMI. However, even if you prove that you are financially capable, you may have to pay a higher rate of interest.

  • Rectify your CIBIL score mistakes:

At times your low score on CIBIL can be a reflection of errors made in your CIBIL score reports. Failing to update the same with your latest transactions or certain misrepresentation of your information counts as an error, which may negatively impact your credit score. Rectifying your errors will not only boost your credit score but would also put you into a category of a deserving candidate for any other loans.

  • Have a co-borrower as back up:

With a low CIBIL score, applying for a personal loan by involving a co-borrower or guarantor may work in your benefit under a ‘Joint Finance’ application. However, you must ensure that your co-borrower has a steady income with a better credit score. In such cases, the concerned financial institution would be that much more likely to grant you the loan.

  • Your last resort for a personal loan:

Pledging your physical assets such as property or jewellery as a guarantee can also increase your chances of getting a personal loan with a low credit score. Needless to say, offering collateral comes as your last resort and only if the above mentioned measures are unsuccessful.


As it is not easier to obtain a personal loan with low CIBIL score, sometimes it pays to wait a few months while simultaneously improving your financial situations and straightening up your CIBIL score. You must also keep in mind that taking another short-term personal loan to clear off another loan never serves the purpose of boosting your credit score and, instead, could lead you into more debt.

It helps to thoroughly assess your financial health through a reliable financial institution. You can avail a free Financial Health Check Report on Finserv MARKETS. The report is personalized, extremely simplified and in depth. With the free financial health check report on Finserv MARKETS, you can now regularly keep track of your credit score!

Read more about How to Increase Chances of Getting Personal Loan

Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition – Offers You Value. A value proposition that ensures you get offers which are tailor made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we work towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App.


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