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Personal Loan

Indian Overseas Bank, otherwise known as IOB offers Personal Loans to meet all types of expenses, whether related to social or a financial commitment. The bank promises simplified documentation and speedy approvals to avail a IOB Personal loan. A Personal Loan can be availed by downloading the application from the website online or by visiting the nearest branch of the bank and fulfilling the necessary formalities.

Personal Loans offered by the Indian Overseas Bank

  1. IOB Clean Loan

The Indian Overseas Bank Clean Loan is issued to employees of public sector undertakings, government and reputed private enterprises, companies, firms, etc. Hence, any salaried individual who is employed with a reputed company may avail this IOB Personal loan. The individuals’ place of employment should have been in existence for a minimum of ten years.

  1. IOB Sahayika Loan or Consumption Loan

The Indian Overseas Bank Sahayika Loan or Consumption Loan is issued to an individual who is a confirmed employee of a reputed organization or a professional, or a businessperson or a self-employed person, who has had three years of experience in his or her field of activity.

  1. IOB Royal Loan

The Indian Overseas Bank Royal Loan is issued to high net worth individuals or self-employed professionals such as C.A.s, doctors, engineers, architects and salaried employees of reputed public interest companies, or private sector companies. Higher Judiciary officials, professors of colleges and universities, high-end I.T. company employees are all eligible for this loan. The income required for IOB Personal Loan is Rs. 75000 per month.

Features of the IOB Personal Loans

  • When applying for the Clean Loan or the Sahayika Loans, the applicant should keep in mind that the minimum required age is 21 years, while the upper most limits on the age bar is 58 years. In case of The Indian Overseas Bank Royal Loan, the applicant’s minimum required age is set higher at 25 years.
  • The maximum loan amount that can be availed through the Indian Overseas Bank Clean Loan is Rs. 15 lakhs. The applicant will not get more than fifteen lakhs or ten times his or her salary, whichever is lower. This is on the condition that the employer of the applicant agrees to deduct the IOB Personal loan installments from the salary and remit it to the bank; or if the salary is routed through the loan-granting branch. If this condition is not fulfilled, then the maximum loan amount that may be availed is Rs. 1 lakh or five times the applicant’s salary, whichever is lower. LIC agents may avail a maximum loan amount of Rs. 10 lakhs or ten times their average monthly commission, whichever is lower.
  • The maximum loan amount that can be availed through the Indian Overseas Bank Sahayika Loan is Rs. 10 lakhs. However, the loan amount is dependent on factors such as the value of the security offered and the capacity of repayment on the part of the applicants. This loan may be availed by professionals, self-employed and businesspersons, including C.A.s, doctors, lawyers and employees of high-end and reputed companies, etc. The maximum loan that can be availed through the Sahayika loan is a total of the loan applicants’ annual income from the previous year as declared in their Income Tax Return documents, or Rs.10 lakhs, whichever is lower.
  • The maximum loan amount that customers can avail through the Indian Overseas Bank Royal Loan is 15 lakhs.

Eligibility for the Indian Overseas Bank Personal Loans

As mentioned above, to apply for a Personal Loan from the Indian Overseas Bank, the customer is required to prove their eligibility and credit worthiness. Only when the bank is satisfied that the customer meets the Personal Loan requirements, will it grant the IOB Personal loan. To this end, we have mentioned a list of IOB Personal Loan amount eligibility criteria that every loan applicant has to match if they wish to avail a Personal Loan from Indian Overseas Bank.

Rate of interest

The applicable rate of interest for this type of loan is linked to MCLR. The IOB personal loan rate of interest for 1 year MCLR is 12.55% per annum (1% interest concession is given if 100% collateral security is provided). Indian overseas bank gives 0.50% concession for women borrowers.

For IOB Royal the rate of interest is;

  • Repayment in less than 4 years is 1 year MCLR = 13.30% p.a.
  • For repayment above 4 years is 1 year MCLR = 14.05% p.a.


For every Personal Loan requests, the Indian Overseas Bank asks its IOB Personal loan applicants to provide certain documents for its verification process;

  • As proof of identity, loan applicants may provide copies of their Passport, Aadhar Card or Driving License or Voter’s ID card.
  • As proof of address, may provide copies of their Passport or Ration Card or Electricity bill or Telephone Bill or Rental Agreement.
  • To verify their income and financial condition, loan applicants may provide copies of their last six months’ bank passbook or the last three months’ bank statement.
  • To verify their credit worthiness and provide detailed information of their salary, loan applicants may provide copies of their most recent salary slip or their current dated salary certificate along with the most recent Form 16.
  • All the documents mentioned above have to be provided in original with self-attested copies.
  • Last, but certainly not the least, the IOB Personal loan applicant will have to give the bank a cheque in favor of the bank with the processing fees amount.

Additional Features of the Indian Overseas Bank Personal Loan

  • The Indian Overseas Bank Clean Loan may be used for any purpose within the social or financial commitment sphere. The Indian Overseas Bank Sahayika Loan may be availed for commitments such as education, holidays, marriage, etc. Indian Overseas Bank does not verify declared purposes. The Indian Overseas Bank Royal loan may be availed for any socio/economic financial requirements.
  • Indian Overseas Bank offers Personal Loans which have repayment tenure of 12 to 60 months. Hence, the personal loan gets cleared in a maximum of five years. Borrowers can opt for a shorter tenure of IOB Personal Loan but they must keep in mind that a shorter tenure has a corresponding higher EMI amount.
  • The Indian Overseas Bank Royal Loan has a longer repayment period of 12 to 84 months.
  • The IOB Personal Loan interest rates as low and competitive as possible so that IOB Personal loan seekers may prefer Indian Overseas Bank above other banks. Furthermore, IOB accountholders are given a preferential interest rate on their IOB Personal Loans.
  • The processing fees for the IOB Personal Loan are very reasonable, and the customer is given absolute clarity about each step of the loan sanctioning process and the loan status. The customer does not have to fear being subjected to hidden costs and charges on the IOB Personal Loan online. To that end, Indian Overseas Bank has made it easy for the loan applicant to check the status of the loan application online by logging onto the relevant page on the Indian Overseas Bank official website. All that the loan applicant has to do is submit the relevant information to get an update.
  • Indian Overseas Bank has an efficient phone banking service that its customers may use in case they have any queries in relation the Personal Loan that they may have availed. The phone banking service customer representatives will endeavor to address any grievances, problems and clarifications that the customers may have.
  • For availing of the Clean Loan, the applicant should have a savings bank account in the branch from where the loan is proposed to be availed. The salary of the employee should be routed through the savings bank account at the branch where the loan is sanctioned. An undertaking letter has to be provided by the employer undertaking to deduct the loan installment from the salary every month and remit the same to the bank. A letter from the employer also has to be produced that states that they will recover the dues from the terminal benefits of the employee in case of the death, retirement or resignation of the employee.
  • For the Clean Loan, the loan applicant will have to provide as security, two third party guarantors who have salaries that are equal to or more than the borrower’s gross takeaway. In case of the Sahayika Loan, the loan applicant will have to provide liquid securities or immovable property as security. This includes UNITS, ULIP, KVP, IVP, NSC and LIC policies. The margin available is 10% on policies bought from LIC and other private insurers, 25% for liquid securities and 50% on immovable property. In case of the Indian Overseas Bank Royal Loan, there is no security, no guarantee nor any margin requirements for Personal Loans.
  • Pre-closure charges on the IOB Personal Loans are at 2.23%. This percentage is applicable whether the loan has been applied for from a rural area or a non-rural area of the country.
  • Indian Overseas Bank takes seven working days to process the loan, which includes the time taken to verify the necessary documents.
  • Processing fees are charged by the bank for procuring appraisals, documentations, credit and employment history or other such similar information that is required for the bank’s loan disbursal department. Indian Overseas Bank offers Personal Loans at very nominal processing fees at Rs. 204 per lakh in the loan amount.
  • Borrowers repay their Indian Overseas Bank Personal Loan through Equated Monthly Installments (EMIs). Borrowers have the option of giving the bank post-dated cheques, they may also arrange for payment through the Electronic Clearing Systems, also known as ECS. Borrowers may give IOB standing instructions to debit the EMI from their Indian Overseas Bank savings account.

Personal Loan Charges



Loan Processing Charge

Rs. 204 for every lakh in the loan amount

Pre-payment Charges

No prepayments allowed prior to 12 EMIs

No Due Certificate / No Objection Certificate (NOC)


Duplicate of No Dues Certificate / NOC


Solvency Certificate


Charges for changing from Fixed to Floating Rate of Interest

Not applicable

Charges for changing from Floating to Fixed Rate of Interest

Not applicable

Stamp Duty & other Statutory Charges

As per applicable laws

Credit Assessment Charges

Not applicable

Non -standard repayment charges

Not applicable

Pre-closure Charges

2.23% for both rural as well as non-rural areas

IOB Rural Loan Scheme – Akshay

The Indian Overseas Bank also offers IOB Personal loans to the rural sector of our country to encourage the rural and the backward population to meet their financial requirements without having to worry about the shortage of funds. The loan scheme is called Akshay and it offers loans to rural individuals. Let us study the features of IOB Personal loan in details for a better understanding.

  • The loan is given to individuals who are employed or engaged in a profession. The individual might also be availed by self-employed individuals or individuals having their own business
  • The loan funds can be used for meeting any personal financial requirements. The bank would not ask for the verification of the end use of the loan funds. The applicant can make a declaration stating the use for which the funds are being availed and such a declaration would be sufficient.
  • Any life insurance policy which is issued by either the Life Insurance Corporation (LIC) of India or any other private insurer should be assigned in the name of the bank for availing this loan scheme. This insurance policy would serve as a security requirement for banks to offer Personal loans. The types of life insurance policies which are accepted by the bank for the security purpose include with profit endowment assurance policies or money back policies. Such policies should have acquired a Surrender Value which is also a basis for granting the quantum of the loan. to this effect, however, policies which are in the name of the minor or are affected under the provisions of Section 6 of the Married Women’s Property Act, 1874 cannot be assigned in the name of the bank as collateral security. Moreover, the life insurance policy assigned should be approved by the Insurance Regulatory and Development Authority (IRDA)
  • The loan amount which is granted would be based on the Surrender Value of the life insurance policy assigned by you to the bank. A maximum of 90% of the acquired Surrender Value of the policy would be payable as loan while the remaining 10% of the value would be held by the bank as a margin under the loan scheme
  • A repayment holiday is not granted under the Akshay Loan scheme offered by the bank
  • The loan availed under this scheme would have to be repaid within a maximum tenure of 3 years or 36 Equated Monthly Instalments without any applicability of a repayment holiday.
  • A processing fee is payable under this loan scheme which is an upfront fee charged by the bank. The loan processing fee payable is Rs.204 for loan amounts higher than Rs.25, 000 and up to Rs.2 lakhs. Thereafter Rs.204 would be payable per lakh or a part thereof. Rural branches, however, qualify for a lower processing fee incidence. They are charged 80% of the prescribed processing fee under the loan schemes they offer.
  • Some important conditions to fulfil for availing the loan include:
  • The premium under the assigned policy should have been up till the date the policy is assigned and to this effect, the latest premium receipt would have to be submitted to the bank
  • The age of the borrower would have to be mentioned
  • If the life insurance policy intended to be assigned as a security has not acquired a Surrender Value, it would not accepted by the bank as the prescribed security and the loan would not be granted
  • The policy to be assigned should have no restrictive clauses which prohibit a valid assignment
  • If the life insurance policy is held in joint names of two or more individuals, all the individuals are required to assign the policy jointly or through a chain of assignments for it to be a valid assignment

Documents Required For the Akshay Loan Scheme

The bank requires the below-mentioned documents to grant a loan under the Akshay scheme:

  • The proper application form for the loan
  • The original policy document of the life insurance policy
  • The last premium paid receipt

Frequently Asked Questions (FAQs)

  • What are the types of IOB Personal Loans available with the Bank?
  • The Indian Overseas Bank offers Personal Loans in different categories which include IOB Clean Loans, IOB Sahayika and IOB Royal. These loans are offered to normal customer and a specialized loan scheme called IOB Akshaya is offered to the rural sector of our country

  • What is the loan amount available as IOB Personal loans?
  • The amount of loan available depends on the scheme of loan opted for. IOB Clean Loans provide loans up to a maximum limit of Rs.15 lakhs while the Sahayika Loan scheme provides a maximum of Rs.10 lakhs as loan amount. IOB Royal offers Rs.15 lakhs as loan and the rural scheme called Akshay offers 90% of the Surrender Value of a life insurance policy assigned to the bank.

  • What is the repayment tenure?
  • Like the loan amount, the loan repayment tenure also depends on the loan type availed. The loan repayment tenure granted for Clean Loans can be 36 months or 60 months based on the amount of loan availed, Sahayika Loans offer repayment tenure of 60 months and Royal Loan can be paid back within 12 months to 84 months. For the rural scheme, the repayment should be done within 3 years.

Checking Loan Status

On applying for a loan, it takes some time for the loan to be processed and the money to be credited in the customer’s account. In the meantime, if the customer wants to check the status of the loan application, the bank also helps in providing the relevant facility. For checking the loan status, the applicant needs to visit the bank’s website and click on the on the ‘Personal Banking’ tab, there is a ‘Status of Loan Application’ option which when clicked opens a new page. The Application details are to be provided in the status page and the loan status will be displayed.

Personal Loan EMI Calculators

Any Interested applicant may login to www.paisabazaar.com. The applicant may select the EMI calculator and fill up the requisite details accordingly. Post-filling up the details such as Loan Amount, Rate of Interest and Tenure, the results would be prompt and the applicant may know the forthcoming EMI amount in case he/she applies for the personal Loan.

Applying for a IOB Personal Loan

The Indian Overseas Bank Personal Loan can be easily applied by visiting Paisabazaar.com. It lets the applicant apply for Indian Overseas Bank personal loan online. The process is easy and can be completed from anywhere without having to pay a visit to the company’s branches and complete the process manually using paper forms.

Indian Overseas Bank Personal Loan
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I took a personal loan scheme from IOB to travel abroad. My loan has 11.65% annual interest rate only. I received my loan amount within a few days. The bank staff were very prompt in helping me to fill my application form successfully.

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Posted on: Jan 11 , 2017