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Banks exercise caution with younger applicants whose income may be unstable, while those nearing retirement are offered shorter loan tenures and face stricter conditions
Banks consider younger customers with stable jobs to be less risky. (Representative/Shutterstock)
Personal loans have become a necessity for many people these days. Whether it’s for a wedding, home renovations, or unexpected medical expenses, obtaining a personal loan from a bank seems straightforward.
However, many people fail to realize that age plays a crucial role in loan applications. Banks consider not only income and credit score but also age to determine eligibility and the terms of funding.
Age essentially reflects the remaining earning period and the number of years a stable income can be expected. This is why banks assess applicants of different ages differently. Applying at an optimal age not only improves the chances of approval but also provides greater flexibility in interest rates and installment options.
What Is The Eligibility Criteria
Most banks consider people between the ages of 21 and 60 eligible for personal loans. Banks are more cautious in the early years, when income isn’t stable. Similarly, those nearing retirement are given shorter tenures and stricter conditions.
What Is The Loan Tenure
For applicants around 25 to 30 years old, banks may offer a longer tenure, typically ranging from 5 to 7 years. For those taking a loan at age 55, banks usually ensure that installments are completed before retirement, resulting in a shorter tenure, generally 2 to 3 years.
What Are The Interest Rates
Banks consider younger customers with stable jobs to be less risky. Therefore, those between 30 and 45 years of age typically receive the best offers. However, customers over 55 are offered slightly higher interest rates or limited offers because the risk to the bank increases.
October 11, 2025, 13:19 IST
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