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Personal Loan

Small Personal Loan vs. Mini Loan: What’s the Difference?

16 Jul 2025 by Team FinFIRST

Small Personal Loan vs. Mini Loan: What’s the Difference?

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The terms ‘mini loan’ and ‘small personal loan’ are often used interchangeably in personal finance. But do they mean the same thing? Not quite.

While both are designed for immediate, short-term cash needs, they differ in loan amount, repayment duration, eligibility criteria, and flexibility. Learning these differences can help you choose the right option for your financial situation—whether you're covering an unexpected bill, buying a new gadget, or managing festive expenses.

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What is a Small Personal Loan?

A small personal loan is an unsecured loan for amounts typically ranging from ₹50,000 to ₹10 lakh, depending on the lender and your credit profile. It is designed for larger expenses such as home renovations, vacations, medical emergencies, or debt consolidation.

Small personal loans, like FIRSTmoney from IDFC FIRST Bank, offer repayment tenures from 9 to 60 months with manageable EMIs. With FIRSTmoney, you can get a loan of up to ₹10 lakh through an end-to-end digital process with zero foreclosure charges. These loans are approved based on your income, credit history, and repayment capacity, without requiring any collateral. Borrowers can use the funds for any personal expense.

What is a Mini Loan?

A mini loan, also known as a microloan, is a short-term loan for a smaller amount, usually between ₹5,000 and ₹50,000.

Mini loans are ideal for covering small, urgent needs like utility bills, school fees, or other immediate expenses. They typically have a shorter repayment tenure, ranging from 1 to 12 months. The eligibility criteria are often less stringent, and approvals are quick due to minimal documentation requirements on digital platforms. They are well-suited for individuals who need quick liquidity without a lengthy approval process.

Whether it's a big dream or a small crisis, knowing the right type of loan can make your borrowing smart and stress-free.

Key differences between small personal loans vs. mini loans

Features	Small personal loan (like FIRSTmoney)	Mini loan (Microloan/Instant Loan)
Loan amount	₹50,000 to ₹10 lakh	₹5,000 to ₹50,000
Repayment tenure	9 to 60 months	1 to 12 months
Purpose	Home renovation, travel, medical, debt consolidation	Small emergencies, bills, short-term needs
Approval time	Instant, typically within 30 minutes	Instant (minutes to a few hours)
Eligibility criteria	Based on income, CIBIL score (minimum 730), and repayment capacity	Simpler criteria, often requiring basic income proof and KYC
Foreclosure charges	Zero foreclosure charges with FIRSTmoney	Usually none

Conclusion

Choosing between a small personal loan and a mini loan depends on your financial requirement, the amount you need, and your repayment preference.

If you need instant funds for a significant personal expense, a small personal loan like FIRSTmoney is an excellent choice. It offers a higher loan amount, a flexible repayment tenure, and zero foreclosure charges.

For very small, short-term funding needs, a mini loan may be more suitable, especially if you need quick access to a smaller amount of cash.

With FIRSTmoney's 100% digital and paperless process, you can apply for a small personal loan that suits your financial plan and get the funds you need almost instantly.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.

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