How Can Someone With a Low Income or Salary Get a Personal Loan

Feb 19, 2024
 |  1 min read
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Securing a personal loan can be a vital financial tool for individuals facing unexpected expenses. However, qualifying for such a loan may be daunting for those with a modest income. While lenders typically prioritize applicants with higher incomes and strong credit histories, individuals with lower salaries can still navigate the lending landscape effectively.

Understanding the factors influencing loan approval and employing strategic approaches can significantly enhance the likelihood of qualifying for a personal loan with a limited income.

Let us find some actionable steps and considerations for the question, “How can I qualify for a personal loan with a low salary?”. Here are some insights into improving eligibility and maximizing the chances of loan approval.

How Do You Qualify For a Personal Loan With a Low Salary?

Qualifying for a personal loan with a low salary requires a strategic approach and a focus on demonstrating financial responsibility to lenders. Here are several steps you can take to improve your chances of securing a personal loan:

  • Improve Your Credit Score: A higher credit score increases your chances of loan approval and favourable terms. Make sure to check your credit report for any errors and work on addressing any outstanding debts or delinquencies.
  • Explore Alternative Lenders: Traditional banks may have stricter criteria for loan approval, so consider alternative lenders such as online lenders, credit unions, or peer-to-peer lending platforms.
  • Provide Collateral or a Cosigner: Offering collateral can strengthen your loan application and assure the lender. Alternatively, having a cosigner with a higher income and better credit score can significantly improve your chances of loan approval.
  • Reduce Debt-to-Income Ratio: Lowering your DTI by paying down existing debts or increasing your income through additional sources can improve your loan eligibility.
  • Consider a Secured Loan: Secured personal loans, which require collateral such as savings accounts or certificates of deposit, are often easier to qualify for than unsecured loans.
  • Compare Offers: Don't settle for the first loan offer you receive. Shop around and compare terms, interest rates, and fees from multiple lenders to find the most favourable option for your financial situation.

What Factors Do Lenders Consider When Approving Personal Loans for Low-Income Individuals?

It’s better to stay prepared with questions like “What factors do lenders consider when approving personal loans for low-income individuals?” Here is a host of factors that lenders consider while approving personal loans for low-income individuals:

  • Age: Generally, salaried individuals aged between 21 and 55 years and self-employed individuals between 25 and 60 are considered optimal candidates for personal loans.
  • Credit score: A credit score 750 is mandatory to qualify for a personal loan with reduced interest rates.
  • Payment History: Consistent, on-time payments demonstrate reliability and financial discipline, which can positively influence loan approval decisions.

What Documents Are Essential When Applying for a Personal Loan on a Modest Salary?

One of the most common queries people have when applying for a personal loan “What documents are essential when applying for a personal loan on a modest salary”? When applying for a personal loan on a modest salary, gathering and providing the necessary documents to support your loan application is essential.

  • Proof of Identity: Valid government-issued identification such as a driver's license, passport, or state ID card is required to verify your identity.
  • Proof of Income: Documentation of your income is crucial for lenders to assess your ability to repay the loan. This may include
  • Employment Verification: Lenders may require confirmation of your employment status and history. This could include a letter from your employer stating your position, salary, and length of employment.
  • Proof of Address: Documentation confirming your current residential address, such as a utility bill, rental agreement, or mortgage statement, is typically required.
  • Credit History: Providing access to your credit report or allowing the lender to conduct a credit check enables them to assess your creditworthiness. This may involve signing a consent form authorizing the lender to pull your credit report.
  • Debt Obligations: You may need to disclose any existing debts or financial obligations, such as outstanding loans, credit card balances, or other liabilities.
  • Collateral Documentation: If you're applying for a secured personal loan, you'll need documentation related to the collateral you're offering, such as vehicle titles or property deeds.
  • Personal References: Some lenders may require personal references to verify your character and reliability as a borrower. Be prepared to provide contact information for individuals who can vouch for you.


While applying for a personal loan on a modest salary may present specific challenges, thorough preparation and organization can significantly enhance your chances of success. By gathering and providing essential documentation such as proof of identity, income, employment verification, and credit history, you demonstrate your financial responsibility and ability to repay the loan.

Individuals with modest salaries can explore alternative options such as mPokket, a popular digital lending platform. mPokket offers a convenient and accessible solution for short-term financial needs, particularly for students and young professionals looking for personal loans in Bangalore. It’s a user-friendly mobile application that allows individuals to apply for loans quickly and conveniently from their smartphones.

This accessibility eliminates the need for lengthy paperwork and physical visits to a bank or lending institution. mPokket provides small, short-term loans tailored to meet immediate financial requirements. Borrowers can request loan amounts as low as a few thousand rupees, which can be repaid over a short period, typically within a few weeks to months.

Gaurav Jalan

Gaurav Jalan is the Founder and CEO of mPokket, a digital lending platform serving underserved Indian youth. He leverages technology and experience to deliver cost-effective credit to marginalized populations. In his role, he provides strategic direction and oversees execution to fulfill mPokket's mission.