When it comes to overcoming a financial crisis, borrowers always turn to personal loans first. Personal loans have been used by a significant number of people, whether for a medical emergency, day-to-day costs, or to finance a large-ticket purchase. It is a suitable option for obtaining income with no effort.
Personal loans are unsecured loans that are issued by banks, NBFCs, and digital lenders to individuals seeking funding for personal purposes. Your monthly income, credit score, and payback history are used by lenders to establish your loan eligibility.
Personal loans have seen some of the most significant changes in terms of product design and consumer group, according to a report by credit bureaus.
The rise of number of personal loans
In India, personal loans have long been available. But it was only in the last decade that they became popular. The number of personal loan applications in India has reportedly increased in recent years, according to numerous publications. However, it is easy to see why borrowers prefer them. Personal loans, after all, are easily accessible, need no collateral, and have low interest rates. They’re also easy and quick to assemble. Again, you have complete freedom in how you use your loan funds.
Reasons for the popularity of personal loans,
Personal Loans are available online
You can apply for a personal loan online with several banks, NBFCs, and online lenders. Furthermore, most personal loan apps and websites will tell you how much you may borrow based on your monthly income when you apply for a loan online. You can also submit your documents through the internet. The loan money is paid immediately into your bank account once the processing charge is deducted once your loan application has been approved.
As we said, all that is required to obtain a personal loan in India is the completion of an online application and the submission of supporting papers. Not only that, but personal loan interest rates have dropped, and most lenders now provide a wide range of lending options. This has encouraged consumers to view personal loans as a safety net rather than a burden in times of financial crisis.
Quick loan application and approval
Personal loans were difficult to obtain in India, and Indian banks were notorious for taking their time in accepting them. You had to submit numerous paperwork and wait for days on end, with no guarantee that your loan would be authorized and disbursed in a timely manner. With advanced technology, applying for a personal loan and receiving approval takes less than two hours.
You may quickly download the personal loan app from the Google Play Store, register, and apply for an online loan. Your papers will be uploaded in a matter of minutes. When your loan application is approved, the funds are immediately transferred to your account. The entire loan process became online. In this way, using a personal loan app you can easily apply and get a personal loan.
Short loan processing time
Personal loans have a faster processing period than auto or mortgage loans. Because personal loans are unsecured and do not require collateral, the loan is handled within 2-3 days after the documentation is filed and the loan is accepted.
Lots of options available
In India, there are a lot of personal loan lenders, so you have a lot of possibilities to choose from. You can compare lenders online and pick the finest one for your needs and budget. Compare lenders by loan amount, interest rates, repayment terms, eligibility restrictions, documentation requirements, customer service, and other factors. Apply to just one lender to see whether you’ll be approved.
Minimal documentation requirements
You do not need to submit a large number of documents when applying for an unsecured personal loan. Personal loans have far fewer documentation requirements than company and house loans. As a result, people are drawn to their low paperwork needs. To apply for a personal loan, you only need to provide proof of your name, address, and income.
Simple eligibility criteria
Personal loan eligibility requirements are simple and basic. To be considered for a personal loan from most banks, you must meet the following requirements:
- The borrower should be between the ages of 25 and 58.
- You must be an Indian citizen.
- The applicant must be a salaried employee with a monthly salary of at least 25,000 dollars.
- You must have worked for your present job for at least 6 months and have a total of at least 12 months of work experience.
Flexible repayment tenure
Most of the bank’s personal loans include repayment periods ranging from 12 to 48 months. So you have the option of selecting a payback period that is ideal for you. Keep in mind, however, that the interest expense for a longer loan term is substantially more than for a shorter loan term. As a result, personal loan repayment is considerably more doable with numerous payback alternatives. You can use a personal loan EMI calculator to figure out how much you’ll have to pay each month and choose the loan term that’s right for you.
Personal loans are gaining popularity in India for a variety of reasons.
Customers in India are increasingly turning to personal loans as a source of funding. Because, the fact that they do not require collateral, that they are more accessible and faster than other loan options, that they provide appealing personal loan interest rates, and so on all work in their favor.