CIBIL Score for SBI Personal Loan

Your CIBIL score acts as the primary criterion that determines your eligibility for a personal loan. All banks, including State Bank of India, assess your score as an important part of the loan approval process. Your score, which is mentioned in your CIBIL report, is an analysis of your credit history, count of your prevailing loans, frequency of loan and credit card applications, timeliness of repayment of dues, and various other factors. These parameters enable SBI to analyze the probability of recovering the personal loan amount, in case they offer you a loan.

For poor and medium good CIBIL scores, personal loan applications are assessed on the basis of other parameters like current monthly income, credit utilization ratio, employment stability, etc.

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Importance of CIBIL Score for Getting SBI Bank Personal Loan

The CIBIL score, evaluated on a scale between 300 and 900, is divided into different categories. 300 defines the lowest score and 900 indicates the highest. Each of these categories has different interpretations for lenders like SBI and other non-banking financial institutions, which determine your personal loan eligibility.

Here’s the meaning of CIBIL scores for SBI personal loan:

  • 750 – 900: While evaluating CIBIL score for personal loan, a score of over 750 is interpreted as a good CIBIL score for personal loans by banks like SBI and financial institutions. An applicant with a score in this range is referred to as being risk-averse, improving his/her chances of personal loan eligibility. The borrower can only avail favorable terms and conditions on the personal loan application, he/she will also be in a position to bargain on a lower interest rate and higher loan amount.
  • 600 – 749: CIBIL score in this range is known as middling scores. While evaluating personal loan eligibility of borrowers with CIBIL score in this range, SBI considers other parameters like existing monthly income, employment stability, the count of prevailing existing loans, to decide on his/her personal loan eligibility.
  • 300 – 599: With a poor CIBIL score, the scope for being eligible for a SBI personal loan is slender. The chances of the SBI personal loan application getting rejected are high. With scores in this bracket, a personal loan might be offered against collateral like gold schemes, assets, shares and fixed deposit. Applicants have to improve their CIBIL score through consistent creditworthy behavior to become eligible for a SBI personal loan. Repeated rejections will bring down your score further, hampering your SBI personal loan eligibility.

SBI Personal Loan Information

SBI personal loans enable borrowers to finance their personal objectives, whether it is a medical treatment or vacation or any other financial need. Let’s take a look at the types of SBI personal loans:

Xpress Credit Loan:

Low interest rates, and that too, charged on interest on a daily reducing balance, makes it one of the most competent personal loans. Low processing charges and lack of security payment and additional charges add to the benefits that this SBI personal loan offers. Minimal documentation makes it even more convenient for borrowers to opt for this SBI personal loan.

  • Salient features

    • NMI starts from a minimum of Rs.5000
    • EMI/NMI Ratio should not be more than 50%
    • Personal loan amount starts from a minimum of Rs.25,000
    • Limit can be up to 24 times NMI subject to a maximum of Rs.15.00 lakhs
    • The available repayment period extends to a maximum of 60 months or residual service period, whichever is less

SBI Pension Loan:

Nominal processing fees (Nil Processing Fees for Defence Pensioners), no hidden costs and Quick and seamless loan processing enable borrowers to meet planned as well as unforeseen personal and medical expenditures. While there are no nominal processing charges applicable for Defence Pensioners, nominal charges are applicable for other loan borrowers.

  • Salient features

    • Eligible for Central and State Government Pensioners till the age of 76 years, pensioners with a defence background and family pensioners
    • SBI personal loan amount starts from a minimum of Rs.25,000
    • The capping for a loan amount over Rs.25,000 depends on the age of the pensioner and the maximum personal loan amount that he/she is eligible for based on his/her age
    • The loan repayment tenure for receiving the pre-determined pension amount is 18 months

Xpress Power :

This SBI personal loan is best suited for employees of Central and State Governments, Quasi Government Bodies, Defence Establishments, Educational Institutions, PSUs, and selected rated corporates.

  • Salient features
    • Eligible for individuals with a gross monthly income of at least Rs.50,000
    • Applicable EMI/NMI Ratio should be no more than 50%
    • Loan amount offered starts from a minimum of Rs.25,000 to Rs.15 lakhs, subject to it being a maximum of 24 times of the NMI

Probable Reasons for SBI Personal Loan Rejection

Your CIBIL Report includes details regarding every defaulted payment for the next three years. Hence, the lack of timeliness of debt repayments becomes visible to SBI when you apply for a personal loan in the future. This raises a red flag for SBI, making them sceptical of offering your personal loan.

The following are some of the leading factors that may lead to SBI personal loan rejection:

  • Defaulting on EMIs of SBI personal loans is another reason that affects your CIBIL score. When your CIBIL score is evaluated during the personal loan application process, a track record of late payments makes the bank authorities conscious about your apparent financial stress. This greatly enhances the chances of your personal loan application being rejected, which further affects your CIBIL score.
  • If you have faced several repeated personal loan rejections in the recent past within a short span of time, avoid applying for another SBI personal loan till you have improved your score. Make a conscious effort to pay your dues on existing loans and outstanding monthly debts on credit cards to enhance your CIBIL score and then consider applying for a new SBI personal loan.
  • Stay away from applying for multiple loans within a short span of time. This is interpreted as debt hungry behavior resulting from financial instability, raising questions about your ability to maintain liquidity. It is highly recommended that you avoid applying for a new SBI personal loan right after the closure of an existing one because that again is a sign of debt hungriness.
  • Avoid being a guarantor to a SBI personal loan applicant. Banks and financial institutions sometimes ask for a guarantor from loan applicants with a low CIBIL score. A guarantor is a co-applicant without the benefits of a beneficiary. When the primary borrower defaults on the loan, it not only affects his/her CIBIL score, but also that of the guarantor. The bank may also ask the guarantor to pay the outstanding debt on his/her behalf.

Tips to Improve Your CIBIL Score

Follow these tips to gradually enhance your CIBIL score for being eligible for SBI personal loan:

  • Make sure to repay the entire amount due every month against your credit card to prevent your CIBIL score from falling. Though banks allow credit card holders to pay a minimum amount, it is best to pay the entire outstanding amount. Paying only the minimum amount due implies that the remaining balance gets carried forward to the next month, which attracts a hefty interest rate and ultimately leads to a debt trap. This not only adversely affects your CIBIL score, but every default gets reflected in your CIBIL report. This again increases the chances of personal loan rejection.
  • It is recommended that you opt for auto-debit at your preferred bank for repayment of your monthly loan EMIs and credit card dues. This will enable you to prevent skipping repayments within the expected date. For such facilities, banks offer you the flexibility of selecting a date as per your convenience. The auto-debit process is scheduled on your chosen date. All that you need to ensure that your chosen bank account should have the required balance on the pre-decided date to prevent an unsuccessful auto-debit. Banks levy a heavy rate of interest on every unsuccessful auto-debit. Paying your debts well within time gets recorded in your report and is therefore, accessible to future lenders when they check CIBIL score for personal loan.
  • Strictly avoid credit hungry behavior like withdrawing cash against credit card, which is interpreted as financial instability. Such information is visible to lenders when they access your CIBIL report, increasing the scope for SBI personal loan rejection.

FAQs On CIBIL Score for SBI Personal Loan

What are the personal loan rates of SBI?

The interest rate on SBI personal loans, as per October 2018, varies between is 11% and 15.4%, depending on the SBI personal loan scheme. There may be additional charges, like processing charges, applicable over and above the basic interest rate applicable on SBI personal loans.

What are the eligibility criteria for getting SBI Bank personal loan?

The below chart will give you a clear understanding of the essential eligibility criteria for purchasing a SBI personal loan:

What if I have a low CIBIL score? Will SBI still give me a personal loan?

The higher your CIBIL score, the higher are your chances of securing a personal loan across banks. The same is applicable for SBI personal loans as well. Not just getting a personal loan, you will also be eligible for it at favorable terms and conditions like comparatively lower interest rate and higher loan amount. A CIBIL score over 750 is generally considered to be a good score.

Middling scores between 600 and 749 reduce your chances of getting a SBI personal loan, but does not eliminate your chances altogether. However, with such CIBIL scores, the bank may consider to evaluate your eligibility for a personal loan based on other factors like monthly income, employment stability, number of existing loans, etc.

CIBIL score between the range of a 300 and 599 minimizes your scope of getting a SBI personal loan to a great extent. In such cases, a personal loan may be offered against collateral like shares, assets, gold schemes and FDs.

Does skipping SBI payment affect my CIBIL score?

Yes, skipping bank loan payment is one of the common reasons that affect CIBIL scores. If you default on your SBI personal loan payment, it will definitely reduce your CIBIL score.

Will a loan settlement with SBI affect my CIBIL score?

Yes, loan settlement with banks, including SBI, affects your CIBIL score.

Can I get more than 3 SBI personal loans if I have a good CIBIL score?

Yes, it is possible for you to get more than 3 SBI personal loans. However, it does not depend only on your CIBIL score. There are several other criteria involved, as per the discretion of the bank.