A personal loan is a type of unsecured loan offered by banks and financial institutions that can be used for various personal needs, such as medical expenses, home renovations, education, or travel. Unlike secured loans, personal loans do not require collateral, but they are granted based on the borrower's creditworthiness, income, and repayment capacity. The loan is repaid in fixed monthly installments over a specified period, with interest. While personal loans provide quick access to funds and flexibility, they often come with higher interest rates compared to secured loans.