Documentation and verification is one of the most crucial part of applying and availing a credit. When you apply for a personal loan for self-employed, you are required to furnish certain documents, including your income proof. 

The papers that you can provide as income proof are profit and loss statements, income tax returns, etc. Such income proofs are necessary for the lenders to judge the repayment capability of the borrower. However, there may be cases where the applicants might not be able to provide their income proof documents.

Fortunately, there are several ways which allows you to avail personal loans with no income proof. Let’s take a look how you can avail other forms of credit when you do not have adequate income proof. 

Loan against gold

Applicants can avail loans against gold and gold ornaments. The advanced amount of a loan against gold depends on the value of the ornament or the gold bar. Furthermore, such advances have a shorter tenor compared to loan against property. 

Joint loans

Individuals can easily get a collateral-free business loan by availing joint loans with a co-applicant who holds income proofs, has a good credit score and a regular source of income. In such cases, you can be a co-applicant without income proof. 

Loan against fixed deposits

You can avail loan of up to 90% of your fixed deposit amount from several financial institutions. 

Loan against property

You can also opt for a secure loan by mortgaging your house, or property, against the loan amount. The value of such credits is substantial, and you will also enjoy a prolonged tenor. The ownership of the mortgaged property lies with the borrower and gets transferred only when you default on payment. Applicants also enjoy tax benefits under section 37(1) and section 24 of the income tax act. 

Interest rate

The interest rate for such personal loan for self-employed with no income proof can be slightly higher than those with income proof. Thus, before you avail such advances do make sure to inquire your lender about the interest rate and other applicable charges on your loan. One of the best times to get an unsecured business loan with no income proof is to apply for them at an earlier age. 

Eligibility criteria

There are certain eligibility criteria that you have to fulfil to avail such a credit. Here are some of them:

  • Age: Applicants have to be between the age of 25 and 55 years. 
  • Business vintage: Your firm should be a minimum of 3 years old. 

Also, you should be a resident of India residing in any of the cities where your lender operates. 

Required documents

Apart from income proof, the other documents required for a business loan are:

  • KYC documents- like Aadhaar card, PAN card, voter ID, passport, driving license, etc. 
  • Address proof- such as electricity bills, water bills, gas bills, telephone bills, etc. 
  • Business existence proof- such as GST certificates, SEBI registration certificates, SSI registration certificates, partnership deeds, etc. 

In addition, to avail a personal loan for self-employed, you will have to provide your recent passport-sized photograph and other relevant financial documents like account statements. 

Besides, if you do not have income proof, you can avail advances from personal lenders or can also consider peer-to-peer funding. You can also appoint a salaried co-applicant while you avail such credits without income proof. 

You are likely to have a higher chance of securing a loan if you hold a credit score of 750 or higher. There are several ways of improving your credit score. You can use a credit card to make smaller transactions. Repay the due amount on time to ensure your business CIBIL score stays above 700.