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Tata Capital > Blog > Personal Use Loan > Personal Loans for 18-Year-Olds: What You Should Know

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Personal Loans for 18-Year-Olds: What You Should Know

Personal Loans for 18-Year-Olds: What You Should Know

A personal loan for 18-year-olds in India is an unsecured loan product that individuals aged 18 can apply for, usually to meet urgent personal expenses like education, travel, or medical needs. While 18 is the legal age of adulthood, most lenders in India typically require applicants to be at least 21 years old to be eligible for a personal loan independently. This is because lenders look for a stable income, credit history, and repayment capacity.

However, some lenders may consider extending loans to 18-year-olds if they have a co-applicant with a stable income or if the applicant can demonstrate consistent earnings through salaried or self-employed work. Students may also explore loan options with parental guarantors. 

Tata Capital requires applicants to be at least 21 years old to apply for a personal loan. Therefore, 18-year-olds may need to wait or apply jointly with a financially eligible co-borrower.

Eligibility Criteria for 18-Year-Old-Applicants

While Tata Capital does not extend personal loans for 18-year-olds, other lenders may have some of the following eligibility criteria for such loans:

  1. Indian Citizenship: The applicant must be an Indian citizen with valid identification proof, such as an Aadhaar Card or PAN Card.
  2. Steady Income: Applicants must prove a steady source of income to ensure repayment ability.
  3. KYC Documentation: Lenders require ID proofs like PAN and Aadhaar Card, along with verified mobile number and address proof. 

Documents Required for Personal Loan for 18-Year-Olds

These are the documents to be carried while applying for a personal loan for 18-year-olds in India:

  • Proof of Residence: Lenders require address proof such as an Aadhaar Card, passport, or a rental agreement.
  • Proof of Income: The borrower must prove sustained income through payslips, bank statements, etc.
  • Photographs: Submitting recent, coloured passport-sized photos is a part of the standard documentation.
  • Employment Proof: It is mandatory to submit proof of employment, like an offer letter, appointment letter, or employee ID.
  • Co-Applicant Details: If a co-applicant is involved, their KYC, income, address proof, and other details also need to be submitted.

How to Apply for a Personal Loan for 18-year-olds in India?

The application process for getting a personal loan involves:

  1. Check Eligibility: After choosing your loan provider, go through the eligibility criteria to ensure that they accept applications from 18-year-olds.
  1. Prepare Documents: Gather all required documents listed by your lender, such as Aadhaar, PAN, income and address proofs, and so on.
  1. Mention Co-Applicant: Apply with a co-applicant if you are missing credit history or a stable income source.
  1. Fill the Application Form: You can apply for a personal loan online or offline. 
  1. Submit Documents: Lastly, submit all required documents with the application and wait till your request is reviewed.

Factors to Consider Before Applying for a Loan at 18

Some factors that can impact your eligibility and application for a personal loan for 18-year-olds are:

  • Credit History: Since you’re 18 and just starting to build a CIBIL score, it might be harder to obtain a loan without a credit history.
  • Loan Amount and Usage: Only borrow an amount you need. Avoid overspending as it may lead to issues with repayment and this can hurt your credit score in the long run.
  • Loan Tenure: Choose a suitable tenure; while a longer tenure can reduce the EMI burden, it can lead to a higher total interest amount paid over time. 
  • Interest Rate and Fees: The final interest rate offered on your loan will be dictated by the lender’s policies and your borrowing profile. As a young borrower, you may face a higher interest rate due an absent or a limited credit history. Compare rates across lenders to secure a favourable offer. Additionally, understand associated charges such as the processing fees to determine the overall cost of the loan.

Key Details About Tata Capital’s Personal Loan

Tata Capital, backed by the trusted Tata Group, is a leading name in India’s lending industry known for its transparent and customer-centric approach. Whether you’re pursuing higher education or managing early financial responsibilities, Tata Capital supports your goals with its flexible personal loan options. The entire process, from application to disbursal, is completely digital and seamless. 

Borrowers can choose flexible repayment tenures up to 6 years, with simple documentation and fast disbursal. Learn more about Tata Capital’s personal loans here.

Conclusion

Getting a personal loan for 18-year-olds in India while difficult, isn’t impossible. However, you must satisfy a set of conditions. Lenders usually prefer candidates over the age of 21 for personal loans, but with a steady source of income and repayment ability, you can get approved for a loan even at 18. Most importantly, make sure you build your credit score responsibly, whether it’s about borrowing funds or repaying in a timely manner. 

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FAQs

What is the minimum age to apply for a personal loan in India?

Most banks and NBFCs prefer candidates who are over the age of 21 for a personal loan. However, 18-year-olds can also be considered responsible candidates for a personal loan, given they have a regular income or apply with a financially stable co-applicant.

Can I get a loan if I just turned 18?

Yes, you can apply for a loan when you have just turned 18. Make sure the lender you are considering allows 18-year-olds to apply for a loan. You can also apply with a co-applicant who meets the eligibility criteria.

Can students apply for a personal loan at 18?

Students don’t qualify for a personal loan unless they have a constant source of income or apply with an eligible co-applicant. Lenders assess the candidate’s repayment ability, so having part-time employment or a guardian’s support helps your chances when it comes to securing a personal loan.

Do 18-year-olds need a co-applicant to get a personal loan?

Yes, it is better for 18-year-olds to have a co-applicant when applying for a personal loan, as it strengthens their chances of getting approved. Having a co-applicant that meets the eligibility criteria boosts the application’s credibility and helps secure favourable loan terms.

How much loan amount can an 18-year-old get?

As an 18-year-old, the maximum loan amount you can get depends entirely on your income, repayment credibility, and whether a co-applicant is involved. At Tata Capital, we offer personal loans up to Rs. 35 lakhs. 

How can I build my credit score at the age of 18?

To start building a credit score at the age of 18, you can become an authorised user on a parent’s credit card. Another way to do this is by taking a small joint loan and repaying its instalments on time. This will help you in building credit score early on.
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