Top 5 Personal Loans for Pensioners in India

These are some of the best pension loan schemes in India for pensioners. Make sure to go through the features and other loan terms and conditions and choose the right loan offer that best fits your needs. For further details on any of these loan products, get in touch with our loan experts.

Download Android App Download iOS App

Top 5 Personal Loans For Pensioners In India

These are some of the best pension loan schemes in India for pensioners. Make sure to go through the features and other loan terms and conditions and choose the right loan offer that best fits your needs. For further details on any of these loan products, get in touch with our loan experts.

The need for emergency financial assistance can arise at any time – irrespective of whether you are in your 30s or 60s. For years, personal loans have been offering timely support to individuals from all walks of life, helping them meet their emergency cash requirements. 

Though personal loans are readily available and easy to secure, older adults, especially retirees, have a hard time securing one. Banks and other personal loan lenders consider pensioners a higher risk – since they don't have a steady source of income. Most banks have an upper cut-off age limit for personal loan eligibility. Hence, senior citizens find it harder to secure personal loan approval.  

But, the good news is that several lenders today recognise the need for financial assistance for senior citizens. They offer exclusive personal loans to pensioners with a wide array of benefits. Here, in this guide, we have compiled a list of the top 5 personal loans in India for pensioners. 

Salient Features of Personal Loans for Pensioners

  • Eligibility Criteria

Both central and state government retired employees who are withdrawing a pension are eligible for personal loans for pensioners. Some banks even offer personal loans for pensionersto former employees of private corporations who receive a regular monthly pension. Spouses who are receiving a family pension on behalf of their deceased spouse are also eligible for this loan. 

  • Repayment Terms

Just like a regular personal loan, the repayment tenure for personal loans for pensioners’ ranges from 12 to 60 months. The maximum tenure varies from one lender to another. 

  • Interest Rate 

The interest rate depends on several factors like borrowed amount, age of the borrower, bank’s policies, collateral or security provided and more. Generally speaking, pension loans have lower interest rates compared to regular personal loans. 

  • Security/Collateral 

Since personal loans are unsecured, they don’t require any collateral or security. Also, since pension loans are offered to senior citizens withdrawing a secure pension, there is no need to provide any additional guarantee or security. 

Additional Reading: National Pension System and its Benefits

Top Personal Loans for Senior Citizens and Pensioners

  1. PNB Personal Loan Scheme for Pensioners 

The personal loan scheme for pensioners from Punjab National Bank is offered to senior citizens drawing pension via a PNB account. The loan amount can be used to meet emergency medical expenses of pensioners as well as other financial requirements. 

Salient Features:

EligibilityAll pensioners drawing pension via any PNB branch
Quantum of FinanceMinimum – Rs. 25,000
MaximumFor pensioners aged up to 70 years: Rs. 10,00,000 or 18 times the net monthly pension (20 times the net monthly pension for defence pensioners)For pensioners aged from 70 to 75 years: Rs. 7,50,000 or 18 times the net monthly pension (20 times the net monthly pension for defence pensioners)For pensioners aged above 70 years: Rs. 5,00,000 or 12 times the net monthly pension
Processing chargesNil
Documentation chargesRs. 500 + GST
Rate of InterestBase Rate + 2.5%
Security/CollateralGuarantee of earning children, spouse eligible for family pension or third-party guarantee
Repayment TenureMaximum of 60 months
(for pensioners aged above 75 the maximum repayment tenure is 24 months)
  1. State Bank of India Pension Loan

State Bank of India offers pension loans to help senior citizens meet their finance requirements. Whether you are looking to fund your child's marriage, take an overseas trip, buy your retirement home or receive medical assistance, SBI pension loans can help you meet all your financial needs. Easy to avail, minimal documentation, SBI pension loan is hassle-free.

Salient Features:

EligibilityFor central and state government pensioners:The borrower must be aged 76 years or belowMust receive pension via SBI bankGuarantee by the spouse (for family pensioners)For defence pensioners:The pension payment order is with SBINo minimum age limitsMaximum age at the time of loan processing not to exceed 76 yearsIncludes pensioners of army, navy, air force, coast guards, paramilitary forces (BSF, CISF, CRPF, etc.), Assam Rifles and Rashtriya RiflesFor Family Pensioners:Age limit should not be above 76 yearsIncludes authorized members of the family who are eligible to receive a pension after the death of the pensioner
Maximum Eligible Loan Amount and Repayments
For central and state government pensioners:
Age at the time of loan sanctionAge at the time of loan repayment completionMaximum loan amount (18 months pension or)Repayment period
Below 72 yearsUp to 77 yearsRs. 14 lakhs60 months
72 – 74 yearsUp to 78 yearsRs. 12 lakhs48 months
74 – 76 yearsUp to 78 yearsRs. 7.5 lakhs24 months
For defence pensioners:
Age at the time of loan sanctionAge at the time of loan repayment completionMaximum loan amount (36 months pension or)Repayment period
Below 56 years63 yearsRs. 14 lakhs84 months
56 – 72 years77 yearsRs. 14 lakhs60 months
72 – 74 years78 yearsRs. 12 lakhs48 months
74 – 76 years78 yearsRs. 7.5 lakhs24 months
For Family Pensioners (including defence pensioners):
Age at the time of loan sanctionAge at the time of loan repayment completionMaximum loan amount (36 months pension or)Repayment period
Below 72 years77 yearsRs. 5 lakhs60 months
72 – 74 years78 yearsRs. 4.5 lakhs48 months
74 – 76 years78 yearsRs. 2.5 lakhs24 months
  1. Cent Pensioners

It’s a personal loan scheme from Central Bank of India for pensioners. It’s available both as a term loan and overdraft facility. 

Salient Features:

EligibilityAll pensioners/family pensioners drawing pension via any Central Bank of India branch.Pensioners who receive their pension via the Treasury or DPDO (Defence Pension Disbursing Office)Pensioners receiving a pension from Central Bank of India.
Quantum of FinanceFor pensioners aged up to 75 years: 18 months pension to a maximum of Rs. 5 lakhsFor pensioners aged above 75 years: 12 months pension to a maximum of Rs. 2 lakhs

For interest rates, processing charges and other details get in touch with the nearest Central Bank of India branch. 

  1. Bank of India Star Pensioner Loan

Bank of India offers the Star Pensioner Loan scheme to regular and family pensioners who withdraw a monthly pension via any of Bank of India’s branches. Retired employees of private firms who receive a pension are also eligible for this loan scheme. However, note that this loan is not available to individuals who have been dismissed from their job or given compulsory retirement. 

Salient Features:

Quantum of FinanceFor pensioner or family pensioner less than 75 yearsMaximum loan amount – Rs. 5 lakhs or 15 times of net monthly pension
For pensioner or family pensioner aged above 75 yearsMaximum loan amount – Rs. 1 lakh or 3 times of net monthly pension
Rate of InterestRBLR + 2.5% = 10.5%
Repayment TenureMaximum up to 60 months
  1. UCO Pensioner Loan

Pensioners who receive pension via UCO bank and retired employees of the bank drawing pension are eligible for this loan scheme. Borrowers can use the loan amount to meet the medical requirements of self/spouse/children, to pay medical insurance premiums, for marriage expenses, educational expenses of children, travel expenses, home renovation expenses, agricultural needs and funeral expenses. 

Salient Features:

EligibilityAll pensioners drawing pension via any UCO Bank branch
Quantum of FinanceFor pensioners with family pension facility available and a living spouseMaximum loan amount – Rs. 10 lakhs for borrowers aged up to 70 yearsMaximum loan amount – Rs. 5 lakhs for borrowers aged above 70 yearsFor family pensioners, pensioners without a living spouse or pensioners without family pensionMaximum loan amount – 10 times the monthly pension subject to a maximum of Rs. 3 lakhs
Rate of InterestFor public – UCO Float Rate + 3.30%For Retired UCO Bank staff – UCO Float Rate + 2.30%
Processing ChargesNIL
Repayment TenureThe loan should be repaid fully before the pensioner reaches 75 years and within 48 monthly instalments
Prepayment PenaltyNIL

EndNote

Don’t Let Financial Emergencies Ruin your Retirement 

These are some of the best pension loan schemes in India for pensioners. Make sure to go through the features and other loan terms and conditions and choose the right loan offer that best fits your needs. For further details on any of these loan products, get in touch with our loan experts here at CreditMantri.

Related Articles

Top 5 Personal Loans For Pensioners In India

These are some of the best pension loan schemes in India for pensioners. Make sure to go through the features and other loan terms and conditions and choose the right loan offer that best fits your needs. For further details on any of these loan products, get in touch with our loan experts.

Read more

When Are Personal Loans A Good Idea?

Personal loans can be useful, given the right circumstances. For example, most people can’t afford to pay cash for a home, making a mortgage loan a necessity. Be sure to consult with a trustworthy financial institution and weigh your options.

Read more

Top Nbfc And P2p Lending Apps Offering Instant Loans

You should keep in mind that its approval time is different from disbursal time. Your application can be approved within minutes however the funds may take some time to credit in your bank account. As the process is online you are not required to you physically visit all send hard copy documents for the loan approval process.

Read more

Get served with your loan eligibility right away!

Download the App Now