People often find themselves in a financial crisis. Applying for a loan is the best plausible option in such a situation. Different types of loans are available, like personal loans, education loans, and housing loans.
Usually, people prefer personal loans to acquire emergency funds or to clear debts.
Today, individuals are preferring instant loans over other available options. With rising digitisation, the demand for instant loans has increased. Someone can apply for a personal loan in Hyderabad or J&K online and get funds immediately.
Read on to know the features and benefits of an instant loan in India.
Understanding the Concept of Instant Loans in India
Instant loans are a variety of personal loans in India offered by banks, Non-banking Financial Companies (NBFCs), and online lenders. There is no need for collateral to acquire an instant loan as these loans are unsecured.
One might think, why not apply for a traditional personal loan instead?
Well, instant loans are a little different from conventional personal loans. Applicants may have to visit a bank and stand in queues for a traditional personal loan. On the other hand, borrowers can apply for an instant loan online from anywhere.
Instant loans are quick and hassle-free, unlike traditional personal loans. At the end of the day, instant loans fall under the category of personal loans only.
Benefits of Instant Loans in India
The top benefits/features of acquiring an instant loan online are as follows:
For acquiring a personal loan from a bank, the borrower has to submit physical documents and proofs. Often, the paperwork for a personal loan can be cumbersome. Since an instant loan is applied online, all documents are uploaded in a digital format.
With minimal documentation, the applicant can quickly get their hands on the loan. The loan approval process is also online and easy.
There can be an emergency of funds, and traditional loans can’t help. In such a situation, an instant loan comes in handy. The approval process for an instant loan is minimal. Funds will be quickly transferred to the applicant’s bank account during an emergency.
No Collateral Required
Not everyone can present collateral to acquire a loan. For example, housing loans are secured loans, but the title deed remains with the lender. The ownership of the house will not be transferred before the closure of the loan.
For instant loans, the credit score of the applicant is judged. No collateral is required, and the loan amount is transferred quickly to the applicant.
An instant loan online offers flexible repayment options to applicants. Loan tenure should be based on one’s repayment capacity and financial position. By increasing the term of an instant loan, the EMI amount can decrease each month.
However, the overall interest charges increase according to the loan tenure.
Apart from the repayment tenure, instant loans also offer a choice of loan amount. If someone wants only ₹ 10,000, INR 10,000, why would they apply for a loan of ₹ 1 Lakh? Online lenders allow users to choose their loan amount based on their financial needs.
Better Interest Rates
Online lenders offer loans at competitive interest rates in India. Comparing the interest rates of loans from different lenders is essential. Higher the interest rate, the costlier the personal loan.
Someone having a credit score of more than 750 can get attractive interest rates on instant loans.
Eligibility for an Instant Loan in India
The eligibility for an instant loan online can change from one lender to another. The generic instant loan eligibility criteria are as follows:
- The age limit bracket for instant loans is usually between 22 and 58 years
- An individual should have a minimum monthly salary of ₹25,000 to get the loan approved quickly
- The credit score of the applicant should not be poor; ideally, the credit score should be more than 700 to get an instant loan
Being the easier and more seamless option, an instant loan is an ideal choice. With NBFCs like Poonawalla Fincorp making the process smooth and very accessible, it would be the wisest choice for any borrower.