What is the Maximum and Minimum Tenure of a Personal Loan
Published on : July 03, 2023

Personal loans have become an ideal choice for individuals to cover any expenses without restrictions. However, the loan tenure affects the personal loan amount and resulting EMIs. Hence, it is essential to know the range of tenure offered by various lenders for personal loans. The loan tenure will depend on the applicant’s creditworthiness and many other factors. Borrowers should carefully analyse the loan term to ensure it fits their financial objectives and capacity to repay the debt.

What is the Tenure of a Personal Loan?

The loan amount is paid back in smaller portions called EMIs over a specific period called the ‘loan tenure.’ The loan tenure can be anywhere between 12 months and 60 months. The loan tenure, along with the loan amount, interest rate, and EMI, can differ based on the borrower’s income, credit history, and requirements.

Personal loans are unsecured loans, meaning that if the borrower fails to repay, the lender cannot seize their assets. This makes personal loans slightly risky for the lender but safer for the borrower. However, personal loans have become increasingly popular for personal financing despite this risk. In fact, they have contributed significantly to the annual increase in credit across various sectors in recent years.

Loan Tenure of Personal Loans Offered by LoanTap

LoanTap offers two different tenures for personal loans, as follows:

  • Short Term Loans
  • Long Term Loans

Short term loans typically have to be repaid within a period of 24 months or less, and they work best when the loan amount is smaller. In cases where the loan amount is larger, you may choose a long term loan as they have a longer repayment period, ranging from 24 to 60 months.

Also read: Difference between Short Term and Long Term Personal Loans

It isn’t always easy to decide whether to go for a short term or long term personal loan. There are a number of different factors that you must consider beforehand. Read our guide to which personal loan is a better option for you. It will help you make a more informed decision so that you can proceed with confidence.

Each loan tenure comes with its own pros and cons. Here are the benefits of short term personal loans and Pros and cons of long term loans.

Factors To Consider While Selecting Personal Loan Tenure

  • Expenses – It is essential to have a strong understanding of your budget in order to create an appropriate repayment plan. Start by outlining your fixed and variable expenses and comparing them to your monthly income after deductions. This will enable you to determine the remaining amount to be allocated towards your EMIs. Having this information will assist you in managing your finances effectively and ensure you can meet your loan repayment obligations.
  • Prospective Increase In Income – If you anticipate a rise in income from new assets or ventures, opting for a shorter loan term can result in long-term savings. While the initial payments may strain your budget, the accumulated interest will have a lesser impact on the overall amount due because you’ll be able to make higher monthly payments within a shorter duration. This strategy can help you minimise the overall interest costs and repay the loan more quickly. 
  • Existing Debts – When formulating your repayment plan, it is essential to consider any current debts or financial commitments. Choosing a loan tenure that allows you to comfortably handle your existing obligations and the EMIs for your personal loan is preferable. This ensures that your income is not overly burdened and enables you to manage your financial responsibilities effectively. You can maintain a balanced and manageable repayment strategy by including all existing debts in your plan. 
  • Personal Loan Interest Rates – The interest rate on a personal loan is influenced by the duration you choose, with longer tenures often associated with higher interest rates. This is because longer loan terms are considered higher risk, providing more opportunities for borrowers to miss payments. It is crucial to strike a balance by selecting a tenure that offers an interest rate suitable for your ability to make timely repayments. By finding this balance, you can ensure that your loan is manageable and aligns with your financial capacity.


The tenure of a personal loan refers to the length of time a borrower has to repay the loan. It typically ranges from one to seven years, depending on factors such as the lender and the borrower’s creditworthiness. Considering the loan duration carefully is important, as it impacts the monthly payments and overall interest costs. Balancing the loan tenure with the borrower’s financial goals and ability to repay is crucial for a successful borrowing experience.Also read: How to Choose the Right Loan Tenure