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About 3,000 years ago, the lending system was first introduced in ancient Greece and Rome. And since then, the system has evolved a long way. Today there are proper systems and regulations in place that help in creating a balance between borrowers and lenders. Earlier, borrowers were concerned and frustrated due to the unpleasant experiences that traditional lenders were providing. Experiences such as long wait for loan approval, unclear documentation process and fraudulent activity including misuse of personal information impacted the mindset of the borrowers.
In recent times, there has been a shift in the attitude of the borrowers due to new and improved offerings from lenders. Instant Personal Loan is one of the prominent features that is offered by lenders. Along with a Personal Loan, there are various other types of loans including Home Loans, Business Loans, Gold Loans, Loans Against Property, Student Loans, Auto Loans and others. However, Personal Loan is preferred over other types of loan and here is why.
No collateral requirement
Generally, the main concern of the borrower is a collateral requirement that might demotivate them from opting for a loan. Having a no collateral requirement is one of the salient features of a Personal Loan. In the case of other loans, there is a requirement for collateral/security which is one of the demotivating factors. Individuals with a good credit score can get the desired amount of loan without any hassle.
Minimal documentation
Earlier on, documentation was a long and tiring process involving various documents. Also, the document approval process was complicated. As there is no collateral requirement the documentation process is simple and easy to understand. With an online documentation process, you can just fill up the documents and submit them online. All the documentation required will be provided on the website.
Flexible repayment tenure
Tenure is the period that is given to the borrower to repay the loan. Usually, the tenure is pre-decided before the loan gets disbursed. As a borrower, you can choose the most suitable tenure according to your convenience. In the case of a Personal Loan, you get a flexible repayment tenure providing the freedom to repay as per your comfort. Generally, the period for repayment ranges from 12 months to 60 months. You can use a Personal Loan EMI calculator to understand your principal and interest components and your repayment schedule.
No hidden charges
Most of the time, borrowers are uncertain about the additional charges that are levied on the loan. It is highly advised that you should check and read all the documents carefully before signing and giving the final approval. This helps in understanding all the requirements that need to be fulfilled while you are applying for an instant Personal Loan. There are many new-age lenders especially NBFCs that are offering a Personal Loan without any hidden charges. As a borrower, you need to pay only what is communicated to you while are applying for a loan.
Quick approval and disbursal
One of the major features of a Personal Loan that has helped the borrowers is quick approval and disbursal. With minimal documentation and easy eligibility criteria, it makes it easier for borrowers to apply for a loan. Many lenders in the market offer a Personal Loan which makes it easier for borrowers to choose from. You can choose the most suitable lender with an attractive interest rate. This makes it easier for the borrowers to repay the loan and get bogged down by a heavy EMI burden.
Eligibility Criteria
Age, citizenship, employment, experiences, and monthly income are a few of the simple eligibility criteria that a borrower needs to fulfil. Alongside, you have a good credit score to get an instant Personal Loan.
Simple application process
As there is no collateral required for a Personal Loan, the rest of the application process is simpler as compared to other loan applications. Also, you can apply for an instant Personal Loan online and fill in the documents online making it convenient for the borrower.
Conclusion
Above mentioned points will help to understand why a Personal Loan is preferred over other types of loan. To conclude, you can apply for an instant Personal Loan without worrying too much about the requirements. A simple and easy-to-understand process makes it convenient for a borrower to apply online.