Personal loans can be given to any of the borrowers who need the money and require spending money for any of the purposes. The loans taken should be repaid on time by the borrower to avoid penalty being charged on the loans. The bank requires proper documentation and also proper credit score and also proper financial stability. The borrower can apply online for the personal loans application through the mobile banking app or website portal. In the case of the online application, the amount can be credited on an immediate basis by the bank into the bank account of the borrower. The personal loans are very easily being approved by the bank as the amount required to be disbursed for the personal loans is less. The loans can be taken from any of the lenders by the borrower. The loans if repaid on time can help the borrower improve their CIBIL score thus making availability for future credits. The loans taken by the borrower can be made available for the tenure of 5 years. The loans taken can be utilized for any of the purposes according to the requirement of the individual.
Personal loans help in increasing the personal expenditure of individuals. Many people can spend thoughtlessly on many of the purchases even while not having a sufficient amount of money. The personal loans taken by the borrower helps spend money even while not having a sufficient bank balance. The bank extends loans only after doing the background verification check of the credit history of the borrower. The loans are useful for the borrower to satisfy their own needs and for the major expenses. Also, financially poor people or the ones who are needy can avail of personal loans from the bank depending on the need up to Rs.25 lakhs for personal expenditures. Personal loans also help individuals utilize the funds during a medical emergency or for costly medical treatments. Banks charge interest rates of 9-15% per annum to the borrowers. The interest rates for personal loans are higher than that of home loans and car loans. There is also no income tax benefit being applicable for the borrower through the income tax department as there is no such provision being made by the government of India for the savings on income tax for the personal loans. The target segment for the personal loans is mostly the ones like lower or average income group people.
Requirements for personal loans
- Proper documentation:
The bank requires documents such as salary proof, employment proof, pan card, aadhar card & address proof for the approval of the personal loans. Without the proper documentation, the bank cannot approve the loans of the borrowers. Thus the requirement of the proper documentation is very much necessary for the bank for the approval of the loans.
- Proper CIBIL score:
The proper CIBIL score is necessary for the approval of the loans. The bank thoroughly checks for the CIBIL score of the borrower before the approval of the personal loans. Bank does not approve the loans for the borrower if the credit score of the borrower is less than 600 points.
- Financially stable applicant:
The borrower should be financially stable while availing of loans from the bank. The borrower should maintain a sufficient bank balance in their bank account for the approval of the loans. Bank straight away rejects the loan application of the borrower in case of the poor maintenance of the bank balance.
The bank requires proper documentation and also proper CIBIL score for the approval of the loans. Bank may reject the loans if the proper guidelines are not being followed by the applicant while applying for the personal loans. The approval of the loans is easy for the personal loans as the amount required for the personal loans is less.