5 things you should know about the personal overdraft facility
Published on : September 20, 2021

You have heard of personal loans but have you heard of the personal overdraft facility? If you need a credit line that you need to use only from time to time, you do not need to take a personal loan with a fixed EMI. You may choose to take the more flexible option of a personal overdraft instead.

How does a personal overdraft work?

A personal overdraft is a credit agreement made with a lender that allows you to get an amount sanctioned but you will be charged interest only on the utilised amount and only for the time period of use. It provides cash on the move. You will not incur interest costs when you are not using the amount.

How to get a personal overdraft loan from Loan Tap?

LoanTap offers a specially tailored product called the personal overdraft loan which is designed to help individuals get a loan sanctioned as per their limit but which they can utilise as per need. It is an unsecured loan and you do not need to provide collateral.

Step 1 – Fill in the online application form and select personal overdraft as the option.

Step 2 – Upload the following documents –

  • PAN Card
  • Aadhaar Card
  • Salary statements for the last three months
  • Bank statement of the salary account for the last six months

Step 3 – LoanTap Team will evaluate the application and if the documents are in order, your loan will be sanctioned.

What are the 5 smart things you should know about the personal overdraft facility?

  • Instant approval and disbursal
  • Flexible Repayment
  • No burden of fixed EMIs
  • Minimum Documentation
  • No collateral

Instant approval and disbursal

The personal overdraft loan is approved within 24-36 hours. Once you need to utilise an amount, you can send a request to LoanTap and the amount will be transferred to your account.

Flexible Repayment

You do not have any fixed EMIs. You will need to repay what you withdraw along with the interest for the actual time that the loan is utilised. 

Interest burden limited to the utilised amount 

The best part of the personal overdraft loan is that the interest burden is limited to the amount withdrawn and the period within which it is repaid.

Minimum Documentation

The paperwork is minimal. You only need to upload the basic documents based on which the loan is approved.

No collateral 

LoanTap does not take any collateral for the personal overdraft facility. The loan is sanctioned like any other personal loan but the treatment is like an overdraft facility.

LoanTap offers overdraft facility in the range of Rs 50,000- Rs 10,00,000 for tenures ranging from six months to five years. The annual interest rates start at 18%. The best feature of the personal overdraft facility is that you can withdraw and repay the amount utilised along with the applicable interest. This gives you the flexibility to pay only for what you utilise and not what is sanctioned. The personal overdraft loan gives you the flexibility to use your credit line responsibly. Getting the entire loan in your account may tempt you to spend it indiscriminately while using the personal overdraft facility allows you to use exactly what you want and repay it with applicable interest.

A personal overdraft loan is a very convenient option for short term financing. It is financially prudent as you would use it only when there is an emergency. It brings in a sense of financial discipline and the interest outgo is based on actuals. It is ideal if you need finance for your business or you can use it when you face a crunch at the end of the month. Since the total amount is pre sanctioned, you need not bother about applying for a loan for every need. You will just need to put in a withdrawal request and the amount will be transferred to your account.

So, you need not worry if you have finance requirements off and on. You can just apply for personal overdraft from LoanTap and rest easy. It will save you the trouble of multiple loan applications. The process will be simple and easy to manage. Your financial needs can be managed smartly. Get a personal overdraft facility from LoanTap and rest easy.

Related articles – Personal Overdraft – It’s like Your Secret Stash of Money