How does nationality or residency status affect my eligibility for personal loan?

Nationality and residency status are important factors that determine your eligibility for a personal loan in India. Most banks and NBFCs need you to be an Indian citizen or a resident with valid proof of identity and address. If you are a resident Indian, you’ll need to provide documents such as your Aadhaar card, passport, voter ID, or driving licence, along with proof of address and income. These requirements help lenders confirm your legal status and gauge your ability to repay the loan.

For Non-Resident Indians (NRIs), the process is slightly different and usually more stringent. NRIs can apply for personal loans from select lenders, but they must provide additional documentation like a copy of the passport, visa along with the proof of overseas address, for e.g., utility bills or bank statement as well as evidence of income earned abroad. Sometimes, NRIs are also required to have a co-applicant or close relative residing in India. The eligibility criteria for NRIs often include a minimum and maximum age limit (commonly 21 to 60 years), a good credit history, and a stable source of income.

A lender's evaluation of risk also takes residency status into account. Since this suggests a greater chance of on-time repayment, lenders typically favour applicants with steady, long-term residency and employment in India. 

It is wise to confirm the financial institution's specific residency and nationality requirements as they depend on the institution's terms and condition. A hassle free approval process and advantageous loan terms depend heavily on meeting these requirements.