SBI Personal Loan for Pensioners

Pension plans are important financial products that ensure payouts even after the retirement. The State Bank of India has different pension plans available that help the pensioners plan and manage their post-retirement expenses. The SBI pension scheme provides for great benefits after retirement in order to lead a worry-free life. The attractive payouts as per the SBI pension scheme also empower them to apply for personal loans in order to meet unexpected financial crisis or any other urgent need.

Features and Benefits of the SBI Personal Loan for Pensioners 

  1. Fast processing and easy documentation and disbursal.
  2. EMI’s for the personal loan will be recovered from the SBI pension account. This facilitates for an easy and hassle-free repayment.
  3. There are no processing fees involved for defence personnel in order to apply for the SBI pension
  4. Easy repayment since you are drawing a pension as a part of the SBI pension plan. The repayment schedule will depend upon the age of the applicant.
  5. A minimal prepayment penalty of 3% is charged on the prepaid amount. In case the prepayment of the loan is made from the proceeds of a new loan applied under the same SBI pension loan scheme the prepayment penalty is waived off. 

Eligibility Criteria for SBI Pension Loans

 Pensioners of the state government, central government and the retired defence personnel are eligible for the SBI pension loan. But the eligibility criteria differs for each of them. 

  1. The age criteria for eligibility is not more than 76 years. This is applicable to the central and state government pensioners, defence pensioners and also family pensioners.
  2. For both state and central government pensioners, the loan amount that can be approved is a minimum of Rs 25000 while the maximum limit is Rs 7.5 lakhs. The maximum limit for the SBI pension loan also can be calculated as 36 times of the monthly pension.
  3. The defence pensioner up to 56 years of age is eligible for a 36 months’ Pension amount with a ceiling of Rs 14.00 lac. While the family pensioners can draw a maximum of 18 months’ Pension with a ceiling of or Rs.2.50 Lakh.
  4. The minimum loan amount is Rs 25000 for all the three categories.
  5. People drawing pensions from any of the private firms will not be eligible to apply for the SBI personal loan for pensioners.
  6. It is also mandatory that the applicant should be a part of the SBI pension plan and be drawing pension through one of the branches.
  7. Also, the applicant has to give an undertaking that they will not change their SBI pension account.

Documentation Needed to Apply for the Loan 

  1. Proof of identity that can include your passport, voter ID card or a drivers licence.
  2. Signed application form with a photograph if applying offline. Visit to apply. 
  3. Processing fee cheque if you are central or state government pensioner.
  4. Latest bank statement of your pension account.
  5. Residential address proof like a rental agreement or the latest utility bill.

 Repayment Period for SBI Pension Loans

 The repayment period is calculated depending upon the age of the pensioner. For central and state government pensioners up to 72 years, it is calculated as 60 months, between 72-74 years it is 48 months and higher the 74 up to 76 years it is 24 months. Defence pensioners gain the benefit of 84 months repayment period up to the age of 56. The rest of the repayment period remains the same as the central and the state government employees. The repayment period and age criteria for people receiving family pension is also similar. The bank has no margin for this personal loan scheme. Also, it should be noted that this pension loan scheme does not offer any insurance policy.

Interest Rates for SBI Pension Loan and Other Rates and Charges

The interest rates for SBI pension loan is calculated to be 3.80% above 2 years MCLR, and this amounts to 13.05% per annum. Apart from this, a processing fee of 0.5% of the loan amount is charged from central and state government pensioners. The defence pensioners are exempted from this charge. With effect from 1st July 2017, a GST rate of 18% is applicable. There are no other hidden costs involved when you apply for the SBI personal loan.

Is there any security required to apply for an SBI pension loan?

The applicant is not required to produce any tangible security of collateral. But if the spouse of the applicant is eligible for a family pension, then he or she has to provide a third party guarantee. Presence of any other family member can serve the purpose in the absence of the spouse.


  1. How soon can the personal loan amount be disbursed?

The exact time period may vary from bank to bank but on an average one can expect the loan to be disbursed within 7 working days of the application. 

  1. All pensioners eligible for SBI pension loan?

In order to be eligible for the SBI pension loan, it is important that the applicant is drawing a pension from one of the bank branches. Also if the applicant is under the SBI life insurance pension plan, he can have eligibility to apply for the loan. 

  1. Is there any SBI pension plan calculator available online?

Yes, one can find the retirement planner on that aids in planning your future post-retirement. It gives a fair idea of how much one should save now to enjoy in the later years of life. 

  1. Which category of people constitutes the defence pensioners?

People who are an employee of Armed forces, CRPF, CISF, BSF, ITBP, etc., Rasht Riya Rifles, Assam Rifles, and Coastguards can avail the defence pension benefits. Provided he or she 76 years of age or lesser. 

  1. What is the national pension scheme calculator SBI and how is it used?

The tool helps in calculating the pension and lump sum that one can draw after retiring at the age of 60. This will depend upon how much monthly contribution towards the NPS is made.