What is the punishment for non payment of personal loan in india?

Not paying a personal loan in India is usually not a criminal offence by itself.

If you miss EMIs, the bank will first call you, send reminders, charge late fees, and report you to credit bureaus. This will reduce your CIBIL score and make future loans and credit cards very hard to get.

For example, if you stop paying a Rs. 3 lakh personal loan, you may later be denied a home loan even if your income improves.

You can go to court, but not normally to jail, just for non-payment.

The bank can file a civil case to recover the money and ask the court to attach (take) part of your salary or other assets.

Jail comes into the picture only if there is fraud or cheating.

For example, using fake documents, lying about your identity, or issuing cheques that bounce.

So, if you genuinely can’t pay (job loss, illness, etc), the best method is to talk to your bank (lender) and propose to them what you can do to pay back the loan in full. It should be like a polite negotiation, where your goal should be to make the lender realize that you genuinely want to pay back the loan, but your current situation is preventing its occurrence.