Personal Loans: How Does Age Influence Your Eligibility To Take A Loan

A personal loan is the perfect answer to many financial needs and requirements. These unsecured loans come with unrestricted use, reasonable rates of interest, and quick application and disbursal processes.

Personal loan eligibility depends on various factors like age, employment stability, income flow, credit ratings, and repayment history.

Out of all these factors, age is a crucial factor that affects not only the approval of personal loans but also other factors like interest rate, loan tenure, and loan amount. 

Here, we will assess the significance of age as a criterion, especially when applying for personal loans.

What is the Age Limit Prescribed for Personal Loan Applications?

Generally, financial institutions quote a generic age limit between 18 and 65 years for the application of personal loans. 

The applicant’s age has an indirect influence on the personal loan application. Financial institutions consider lending to a person who is less than 18 years of age or more than 65 years of age a big risk, mainly due to repayment capacities.

When approving personal loans and attributing the best interest rate deals to borrowers, age again plays a vital role, as providers prefer giving it to the younger or middle-aged lot because of their earning capacity or success in their professional lives.

Use a personal loan eligibility calculator to assess your chances of acquiring an approved personal loan.  

Does that mean that an applicant who is less than 20 years of age or more than 67 years old cannot get a personal loan?The answer to this question is NO.

Age is just a criterion to assess the eligibility of your loan. But there is a reason behind considering this age. Factors like repayment, employment success, and credit history play a vital role in approving personal loans.

Let’s take an example of an 18-year-old college-going individual or a 70-year-old businessman applying for a personal loan. 

If both are capable of adhering to the following requirements, there is no reason to reject their loan applications:

  • They show a high credit rating (preferably 750+) and a good repayment history.
  • They have good sources and flow of income and can fit the monthly EMI of the loans in their monthly income without any financial constraints.
  • They don’t have any existing loans and have always made timely payments of their dues.
  • Retirees are also given preference for personal loans, irrespective of age, based on the income they earn from sources like pension, investments, retirement plans, investments in real estate, and post-retirement entrepreneurial activities.

Thus, there is no official minimum or maximum age limit financial institutions consider for personal loan approvals. Every provider has its own eligibility criteria, and if an individual meets the other requirements, then age becomes just a number!

The Impact of Age on Other Factors in a Personal Loan

Besides eligibility, the age of an applicant affects other parameters as well. Here is how age can influence important personal loan factors:

Link Between Personal Loan Interest Rates and Age

Any person, whether too old, too young, or middle-aged, who has an average credit rating, has no or weak repayment history, or has existing debts will be offered high rates of interest.

On the other hand, employment, sources of income, and capacity to earn in the future also greatly influence interest rate offers.

Two individuals aged 35 and 65, having the same credit rating and same income, will be offered different rates of interest based on the probability of earning high income and better employment security. 

Thus, a higher age can attract high interest rates in this case. At the same time, a middle-aged individual who still promises several years of income and employment gets the benefit of lower interest rates.

Link Between Loan Amount/Loan Tenure and Age

Age plays a crucial role in assessing an individual’s loan amount and loan tenure. A young individual, especially between the age of 25-40, has a better chance of acquiring a high loan amount and flexible loan tenures.

The key reason is that young age indicates a greater number of years of employment and stable sources of funds for the individual.

Financial institutions may be sceptical about the repayment capacity if you are too young or too old. Income is one of the most critical factors that decide the approval of high loan amounts and longer loan tenures.

Aged people may not have a steady source of income to repay the loan, so they may not be the best-suited demographic for a loan.


It is a fact that age is a crucial factor to consider in the personal loan eligibility criteria. Your age can affect other elements of your loans and has a major influence on personal loan approvals.

However, exceptions are made by several financial institutions, where age is treated just like a normal number, provided the other conditions are met. 

So, if you have a good source of income, a high credit rating, a decent repayment history, and stability in your employment (especially business), you can apply for a personal loan today, irrespective of your age.

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