If you have tried getting a loan a couple of decades ago, you would know the amount of paperwork and time involved. The number of forms to be filled out, the number of attested photocopies that had to be attached and the numerous trips to the lender made it a long drawn and tiring process. In the last few years, the evolution of digital technology and the fintech industry has completely changed the lending landscape. Access to a smartphone has simply put the world at everyone’s fingertips.
Today, your smartphone becomes your gateway to anything you need – your groceries, medicines, clothes, gadgets, your investments and your loans too!
Before the advent of smartphones, the banks and NBFCs mostly concentrated on the metros and the tier 1 cities leaving a vast majority of the population unpenetrated. The cost of lending was high due to the high overheads including setting up a physical office, hiring staff. Verification and evaluation of applications took several man-days because of the physical effort involved.
Today digital technology has completely revolutionized the way we lend and borrow money. Established lenders like banks and NBFCs have created an online presence while new kids on the block, the fintech companies have set up websites/ smartphone apps taking lending to a whole new level.
The time taken to disburse a personal loan from the submission of application has been reduced to just 24-36 hours from 10-15 days a couple of decades ago. The reams of paperwork have been completely eliminated and replaced by online applications and upload of documents. The process of photocopying has been eliminated.
The physical process of verifying the credit score to evaluate an application has been replaced by an API which has reduced the turnaround time to minutes. Online lenders have penetrated the heart of the country and reached each individual who has access to a smartphone.
Today, personal loans are the most popular financing option available. Let us examine the features of a personal loan and you will agree that it is indeed a customer-friendly product.
- No Collateral Needed
- Easy Eligibility Criteria
- Minimum Paperwork
- Quick Processing
- Flexible Repayment Options
- No Prepayment charges
- Lower Interest rates
- Customized Lending Solutions
Let us explore each feature in detail.
No Collateral Needed
The personal loan is such a popular financing option because it is an unsecured loan. Since there is no collateral involved young salaried professionals find it very convenient to apply for a personal loan. A personal loan attracts interest from people who have just started out on their career and need immediate funds to meet an urgent expense.
Easy Eligibility Criteria
Unlike a home loan or a vehicle loan, the criteria for a personal loan application is relatively simple and easy to fulfil. If you are an Indian citizen or resident over the age of twenty-one years and earning more than Rs 30000 as net monthly income, you are eligible to apply for a personal loan.
Normal loans involve a lot of paperwork and documentation. However, a personal loan online is popular for being very simple and paperless. At LoanTap, for example all you need to do is to fill up an online application form and upload the following documents –
- PAN Card
- Aadhaar Card
- Salary Slip of last three months
- Bank Statement of Salary Account of the last six months
That’s the only documentation required. Simple, isn’t it?
Unlike the processing time measured in days and weeks in the past, online personal loans today are completed in 24-36 hours from start to finish. The process has become much simpler and faster which has added to the popularity of the option when it comes to an emergency.
Flexible Repayment Options
Personal loans offer flexible repayment options to the borrowers. Based on their situation, they can opt for Interest only EMI payments, step up option, term or overdraft repayments. The borrowers can pick the most convenient repayment option that fits their monthly budget.
No Prepayment charges
Once the personal loan is serviced for six months, the borrower can choose to prepay part or the entire loan without any prepayment charges. This is an extremely customer friendly clause that gives the borrower the flexibility to be debt free in six months. This feature makes the personal loan a very popular product to manage short term fund crunches.
Lower Interest rates
Though credit cards are very easy to swipe and obtain credit, they come at a much higher interest rate if the payment is not made in full by the end of the credit period. Credit cards normally charge over 2- 2.5% interest per month. On the other hand at LoanTap, you can get a personal loan at just 18% per annum. If you want to exercise financial prudence, it is best to plan your finances and opt for a personal loan instead of swiping the card for big ticket expenses.
Customized Lending Solutions
Digital technology has ensured that smart lenders come up with interesting tailored solutions to meet the unique needs of their customer population. Today’s borrowers expect to find customised solutions for their financing needs. Be it a wedding, home renovation, rental deposit, medical loan or even an advance salary, they expect loan offerings that meet their specific needs. Savvy lenders are good at creating unique solutions that appeal to the target group.
Whatever be your personal loan need, you can be sure that you will find a tailored personal loan at LoanTap. We are tech savvy and can offer smart solutions to your unique financing needs. Whatever be your requirement, we are just a few taps away !
Related article – Why are FinTechs a better option for availing loans?