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Personal Loan for Government Employees 2022

Personal Loan Interest Rates for Government Employees

Last Updated 20th Jan 2022

Interest rate10.25%
Age18 years to 65 years
Max Tenure5 years
Max Loan Amount ₹ 75 Lakh
Apply for Personal Loan @ 10.25%* Get upto ₹ 1,000* Cashback

Personal Loan for Govt Employees

  • The interest rate on Personal loan for government employee starts @10.25%
  • Special offers are available for government employees of India and public sector undertakings
  • Lenders do not charge processing fees for defence personnel
  • Lowest interest rates for employees of public sector banks

HDFC and ICICI bank offer the lowest interest rates of 10.25% for Government Employees. Based on the processing fee, ICICI Bank offers the lowest processing fee with 0.99% charges for government employees working in Defence. For central government employees, the best personal loan rates are 10.25% to 17.25%.

Personal Loan for Govt Employees - Best Banks Offer

SBI Personal Loan for Govt Employees

Interest rate10.60%
Loan TenureUp to 72 months
Loan Amount ₹ 20,00,000
Processing feesUp to 1.00% of loan amount

Axis Personal Loan for Govt Employees

Interest rate14.00%
Loan TenureUp to 48 months
Loan Amount₹ 20,00,000
Processing feesUp to2.25% of loan amount

ICICI Personal Loan for Govt Employees

Interest rate14.75%
Loan TenureUp to 60 months
Loan Amount₹ 30,00,000
Processing feesUp to 2.25% of loan amount

HDFC Personal Loan for Govt Employees

Interest rate10.25%
Loan TenureUp to 60 months
Loan Amount₹ 50,00,000
Processing feesUp to2.00% of loan amount

Government Bodies Who Offer Personal Loans

Maharatna PSU – The companies whose 3 years average annual profit is ₹ 5,000 crore or average annual net worth of ₹ 10,000 crores for 3 years or average annual turnover for 3 years is ₹ 20,000 crores are eligible to become a Maharatna PSU. Presently, there are 7 government companies that come under Maharatna categories and these are BHEL, GAIL India, ONGC, NTPC, Coal India, Indian Oil Corporation and Steel Authority of India. The rates for these PSUs are different from the rates offered to private sector companies. The personal loan rates for Maharatna PSU employees are 10.25% to 13.99%

Navratna PSU – Navratna PSUs are decided on six parameters like net worth, net profit, total manpower cost, the total cost of production, cost of services, PBDIT (Profit before Depreciation, Interest and Taxes), capital employed etc. A Miniratna company with 4 independent directors on its board team can become a Navratna PSU. Navratna PSU includes 17 companies and some of these are Bharat Electronics, Hindustan Aeronautics, Bharat Petroleum Corporation, Oil India, NMDC etc. Personal loan interest rates for Navratna PSU are 10.25% to 13.99%.

Public Sector Banks – These banks are those whose majority share of more than 50% is held by a government. Currently, there are 21 nationalized banks in India which mainly includes SBI, PNB, Bank of Baroda, UCO Bank etc. The loan rates for Public Sector Bank employees are 15.50% .

Central Government Enterprises – In these companies, the direct holding of Central Government Departments/ Institutes or other Central Public Sector Undertaking is 51% or more. The personal loan rates for Central Government employees are 10.25% to 15.20%.

Railways – Indian Railways is a State-owned national transporter and is owned and operated by the Government of India via the Ministry of Railways. Indian Railways employees can get personal loan at 15.20%.

State Government Enterprises - The rates for State Government employees and Institutes like Universities, Colleges, etc. vary from bank to bank. Currently, personal loan rates for State Government Enterprises are 10.25% to 15.20%.

Personal Loan Rates for Govt Organization: HDFC and ICICI Bank

HDFC Bank RatesICICI Bank Rates
Maharatna PSU10.25% 11.60%
Navratna PSU10.25% 12.25%
PSU Banks15.50% 13.25%
Central Govt. Employees10.25% 10.25%
Railways10.25% 10.25%
State Govt. Employees10.25% 10.25%
Defence15.00% 10.25%

Personal Loans for Defence Personnel

  • Banks have come out with special offers for our armed forces, in lieu of their unmatched contribution to India. Banks such as HDFC and ICICI Bank offer special on personal loans for defence personnel as they classify under the armed forces category. Key armed forces categories which are eligible for these offers are BSF, CRPF, ITBP, CISF, SSB, NDRF, Police department, The Indian Airforce, The Indian Navy and The Indian Army.
  • The eligibility of these loan schemes is linked to the seniority and designation of the personnel. The personal loan rates for defence personnel are 10.25% to 15.00% . Also, remember to compare the processing fees before taking a personal loan offer for defence personnel as many banks offer nil processing fee on loans for armed forces.

Personal Loan for Pensioners

  • Pensioners or retired individuals are often in need of funds to meet their personal expenses such as a child’s wedding or medical expenses. Leading banks such as SBI and ICICI Bank offer personal loan for retired government employees at the lowest discounted rates. These loans can be availed by retired employees of the Central Government, State Govt. or defence forces.
  • Banks cap the maximum age of pensioners to be eligible for a personal loan at 76 years with a maximum loan tenure of up to 5 years. Banks charge a nominal processing fee for pensioners. SBI charges 9.75% to 10.25% interest rates for pensioners and the interest rate of ICICI Bank for pensioners is 16.00% .

Eligibility Criteria for Government Employees Personal Loan

  • Minimum age of the applicant should be 21 years and maximum 65 years.
  • Govt. and permanent salaried employees with a minimum income of ₹ 25,000 per month are eligible for a personal loan. Income eligibility may vary depending on your profile.
  • Bank give loans to those applicants who are at least 6 months experience in their current job with a total experience of 3 years although it may vary from bank to bank.
  • CIBIL score should be 700 or more than that with a good credit history which is equally important to get approval on loan application.

Documents Required for Public Sector Personal Loan

  • Signed application form
  • Age proof - Passport, PAN Card, Birth Certificate, Employee ID Card
  • Identity proof - PAN Card, Aadhar Card, Driving License
  • Address proof – Passport, Voter ID Card, Aadhar Card, Utility bills (not more than 3 months old)
  • Income proof – Form 16 of last 2 years, salary slips of last 6 months and last 6 months bank statement

Personal Loan Fees and Charges for Government Employees

Banks charge fees from PSU employees on processing and pre-closure of personal loans. These charges include -

  • Processing Fee – This fee varies from bank to bank and is higher than secured loans and can range upto 2% for government employees.
  • Pre Closure Fee – This fee is charged when you want to close your loan before the completion of the tenure. Foreclosure charges are different in all banks. Most of the banks charge a preclosure fee from nil to up to 5% on outstanding loan amount.


Maximum Annual Percentage Rate (APR)11.39% to 16.9%
Representative example of the total cost of the loan, including all applicable fees Here is an illustration of the total cost of the loan:
  • Total amount borrowed: ₹ 1 Lakh
  • Time period: 12 months to 60 months
  • Interest Rate: 10.99 % to 16.50%
  • Processing Fee payable to: Upto ₹ 2,000
  • Fee payable to MyLoanCare: NIL
  • Total Monthly Cost – From ₹ 2,174 for 60 months ₹ 1 Lakh loan at 10.99% (lowest rate, longest time period) to ₹ 9,097 for a 12 months ₹ 1 Lakh loan at 16.50% (highest rate, shortest time period). This is inclusive of principal repayment.
  • Annual Percentage Rate (APR) of charge including all applicable fees: 11.39% to 16.9%
Total cost payable over loan tenure: ₹ 11,161 for 12 months loan to ₹ 32,424 for 60 months loan


What is the lowest interest rate on a personal loan for government employees in India?

As per the current rates, the lowest rate on personal loan for government employees starts at 10.25%. However, the interest rate for every lender is different.

How much personal loan can a government employee get?

Banks provide personal loans to government employees of India and public sector undertakings. To avail of a personal loan upto ₹ 50 Lakh, they must have a minimum income of ₹ 25,000. However, the amount of loan a government employee varies as per their profile and income eligibility.

Are government pensioners eligible for a personal loan?

A personal loan can be availed by self-employed individuals and salaried professionals, including all the government employees of India and public sector companies. There are various banks which provide a loan for government pensioners as well. However, before taking a loan, one must check the eligibility criteria for choosing a personal loan.

How much loan can a government employee get in SBI, and at what interest rates?

The rate of Interest for SBI personal loans for govt employees starts at 9.75%. The bank also charges a processing fee of 0.25. In addition, SBI also offers a personal loan for upto ₹ 14 Lakh to government employees.

Is a Personal Loan for retired government employees available?

Yes, top banks such as SBI, PNB and Axis Bank offer a personal loan for pensioners for retired employees. The rate on these loans is lower than the personal loan rates and currently starts at 10.25%.

Can I apply for personal loans for government employees with bad credit?

No, you cannot apply for personal loans for government employees if your credit score is low. You need to have a credit score above 750 to avail the same because a credit score shows the creditworthiness of a borrower.

What is the minimum salary required for a Personal Loan for govt employees?

The minimum salary required for personal loan for govt employees is ₹ 25,000. Remember that the eligibility criteria for every bank for such loans is different.

Which bank is best for personal loan for govt employees?

Currently, HDFC Bank is the best bank for personal for govt employees because it offers the lowest interest rate of 10.25%.

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*Terms and conditions apply. Credit at sole discretion of lender, which is subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and collected from public sources. Read More
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