Once a fan creates more noise, it should be considered near to getting damaged. (except a noise coming from a variable speed drive). Its possible to put some silicon grease/oil on it to have it work for some extended period. But since some of the PSU electronic components running with power dissipation then a lot of heat are produced (that is why PSU always have fan in it, not just to ventilate the case). In case of fan damage or running slower, the heat accumulation is potentially higher and will definitely start damaging the component.
Have it replaced with new fan is a good choice to take.