With India going through the highest unemployment phase in 45 years, the prospects of even graduates securing a decent job is fast diminishing. When you are already plagued by the stress of unemployment, adulting in life gets daunting as securing a loan for unemployed people is almost impossible and the obligation to attend social gatherings, indulging in little pleasures would be a menacing task, as all of them would mean spending money. In the absence of a steady income people are forced to live out of their parents income/savings and can become detrimental in the case of emergency cash needs; or even to kickstart an entrepreneurial dream.
Much like everyone else you would think of getting a loan for your personal purposes in such cases. But here is the catch. Your chances of getting a loan to start a business or for any personal needs when you are unemployed is extremely low, as all conventional personal and business loans require income proof to display your ability to repay the loan. In this blog we explain how to avail a loan for unemployed people in times of emergency cash needs.
Loans for unemployed people
There are some lenders who offer personal loans for unemployed people at different interest rates, loan tenure and other factors that may vary from loans given to people with a steady income. Contrary to popular belief that getting a loan without a job is impossible, you can always get credit in the form of loan against asset, payday loans, gold loans and personal loan schemes offered by the government for the unemployed like the Prime Minister Rozgar Yojna.
Loan against asset
Loan against asset or asset based lending is to avail a loan amount by pledging some asset as collateral or security. Popularly, property is pledged for money and this is the reason why having your own property is one of the most prized possessions. The loan amount given depends on the market value of the asset/property pledged. In the case of a residential property 50-60% of the property value will be sanctioned as loan amount upon the lender's discretion. Other assets that can be pledged are cars, bikes, rent receivables, fine art and collectibles. This is also called a secured loan.
Payday loans or early salary loans
Early salary loans are straightforward as its name suggests and is typically a cash advance taken earlier than your payday, except you don’t have a job yet. In this type of loan for unemployed people the applicant can avail a loan in return for assurance of securing a job in the near future. You can show your offer letter or appointment letter to apply for an early salary loan. Once the lender has sufficient proof that you will be employed soon, he will sanction the loan in good faith. This can be repaid once you start earning income.
Another scheme by the government to uplift agriculture graduates from unemployment is to offer agriculture loans for unemployed people through tie ups with several banks and financial institutions. Any agriculture graduate of 22 years and above can avail this loan to engage in any agricultural-related activities. Utilising this type of loan to start a business in agriculture like organic fertilizer distribution, poultry farming, mushroom cultivation, flower business etc., can prove really profitable
Prime Minister Rozgar Yojana
The Pradhan Mantri Rozgar Yojana or Prime Minister Rozgar Yojana is a credit assistance scheme formulated in 1993 especially for the unemployed youth. The government offers loans to unemployed youth to start their own ventures in industries, business and service. The minimum requirement is for the applicant to be 18-35 years of age with an 8th grade qualification. Loan amounts of 2 to 5 lakhs are sanctioned and the loan is of composite nature. In the case of a joint venture, loan amount extending upto 10 lakhs can be granted.
This is one of the best and most easiest types of loan for unemployed people to procure as gold jewellery is a must-have asset in every Indian household. In the case of an emergency cash requirement for either personal or business use, you need not go to the extreme of liquidating your asset. You can simply use the existing gold jewellery at home and pledge them for an almost equivalent value loan amount. Gold loans are most preferred as they are secured loans and incurs a low interest rate when compared to other loans for unemployed people. The fear of losing the asset is also unwarranted as the gold jewellery is secured safely in bank lockers and returned in the same condition upon repayment of the loan.
Availing a gold loan at Rupeek is a viable option for people with no jobs as the application process is fairly simple and does not require any exhaustive documentation. Following are the easy steps you need to follow to avail the benefits of a gold loan with Rupeek:
- Use the gold loan calculator to find your EMI estimate
- Apply online on the Rupeek website
- A loan officer will evaluate your gold at your doorstep
- Highest per gram rate, upto 85% of the gold’s value will be offered as loan amount
- A basic KYC process will be done with Aadhar, PAN card, address proof etc
- The loan amount will be credited to your account within 30 minutes of approval
Since there is no end-use restriction you can use this money for a small business startup or for your personal needs. If you ever thought getting a loan without a job was a herculean task, by the end of this blog you would have gotten some clarity and hope!