Personal Loan

All You Need To Know About Retired Pensioners’ Personal Loan Scheme


The requirement for finances might come up at any time. Personal loans are extremely useful in times of financial need since they are not attached to any specific purpose. Although personal loans are widely available on the market, retirees may have a more difficult time obtaining approval. Banks view elderly people as having a higher risk and are less inclined to give loans to senior citizens. However, retirees with a pension remain in a better position. Listed below are a few top banks that provide pension personal loans to retirees.

State Bank of India

Retirees may have financial needs that require them to take out a loan. The State Bank of India (SBI) offers loans to retirees to fulfill these needs. This loan is available to government retirees (state or central) or defense retirees under the age of 76. They must obtain their pension from SBI, and the loan can be obtained from any branch.

Features of an SBI Personal Loan for Pensioners

  • The processing charge is less, and there is no processing cost for military retirees.
  • The loan processing is fast.
  • The loan has no interest charges.
  • If a person increases the credit on their loan account, the loan burden and loan interest will be reduced.
  • The minimal loan amount for Central Government workers is Rs. 25,000, and the highest pension period is 18 months, with varied top limits for different age groups.
  • The lowest loan amount for defense is Rs. 25,000, and the maximum is for 36 months, capped at Rs. 14 lakh for pensioners under the age of 56.
  • There is also an 18-month pension with a varied maximum cap for various ages.
  • The repayment time is specified according to age.

Eligibility Criteria

  • The maximum age for government (central and state) pensioners is 76.
  • Individuals eligible for defense pensions must have served in the armed forces (CRPF, CISF, BSF, ITBP, Assam Rifles, Rashtriya Rifles, or Coast Guard).
  • The principal pensioner’s spouse may get the pension after their death.
  • Their age should not be over 76 years.

Interest Rates

  • The interest rate on the SBI Loan for Pensioners is 3.80% higher than the two-year MCLR. It is presently 11.45% per year.
  • The processing charge for government (central and state) pensioners and family pensioners is 0.50% of the amount of the loan. GST (which is subject to a threshold of 500 and extra applicable GST) will be added.
  • Defense pensioners pay no processing fees.
  • Those who repay the loan before the expiration of the term must pay 3% in prepayment costs.

Central Bank of India

The Central Bank of India Personal Loan to Pensioners is a financing product offered by the Central Bank of India to provide financial assistance to pensioners. A pensioner can apply for a personal loan. As a result, individuals have an avenue to use the pension personal loan for any personal needs such as medical bills, wedding expenses, and so on.

The loan amount offered by the Central Bank of India Personal Loan to Pensioners can be used to fulfill any financial costs or personal emergency needs that an individual may have. This loan may also be used for healthcare crises, house renovations, family vacations, and other similar purposes.

Eligibility Criteria

The applicant must be a family pensioner getting their pension from a Central Bank of India branch.

Forms of Financing Offered

The loan might be disbursed in the form of a term loan or an overdraft.

  • Pensioners below the age of 75 will get an 18-month pension, with a limit of Rs. 50,00,000.
  • Pensioners over the age of 75 will get a 12-month pension, capped at a maximum of Rs. 2,00,000.

Interest Rates

The interest rate will be the base rate of 9.70% + 2.00%, for a total of 11.70%.

How to Apply

People may apply by downloading the forms from the website and submitting them, along with supporting documentation, to the nearest Central Bank of India branch. The registration form may be obtained online; however, the applicant must visit the branch with the completed form and documentation. The Central Bank of India Personal Loan to Pensioners can be availed of as a personal loan for doctors who receive a pension as well.

Bank of India

This is a unique lending program available to people getting a routine pension through a Bank of India branch.

Unsecured Loans

Unsecured loans can be used to cover wedding expenses, medical bills, and education expenses for oneself, one’s spouse, one’s child, or close relatives. The loan amount may also be used for home repairs, renovations, extensions, or other personal needs. If the borrower chooses an unsecured loan, an undertaking will be sought from the borrower indicating that the cash was used for the stated purpose.

Secured Loans

A secured loan may be used to pay off an existing mortgage or to buy consumer goods, computers, or professional equipment. Proof of receipt for incurred expenses must be acquired.

Eligibility Criteria

The BOI Loan for Pensioners is available to monthly pensioners or family retirees who get a regular monthly pension from the branch. It is also available to retired employees who did not lose their jobs or have to retire because of their age.

Forms of Financing Offered

BOI gives loans in the form of a demand loan, a term loan, or an overdraft that can be reduced based on when the loan is paid back.

Interest Rates

The interest rate on the Bank of India (BOI) Loan for Pensioners is the base rate + 2%. The base rate is 9.70% plus 2%, for a total of 11.70%. If the collateral is available and worth more than 25% of the loan, the person will receive a 1% interest rate reduction. The highest allowable base point for 1% security is 100.


Pension personal loans can fund personal necessities. If the conditions are favorable, the bank from which the individual gets the pension will provide a loan. These loans may be used to fund almost any need a person has. Visit Piramal Finance for more information on retired pensioners’ personal loan schemes.