Online Personal Loans

Online Personal Loan vs Bank Loan: Which One is Better?

Digitalization has enabled people to perform financial tasks from their network-accessed devices efficiently. And we are not only talking about making transactions or checking your bank balance. We are talking about applying for a personal loan. Yes, you can now apply for an instant personal loan online for quick and easy approvals with hassle-free documentation and fewer restrictions.


How an Online Instant Personal Loan Works

Applying for a loan through the traditional offline method is a long process. You need to approach a financial institution or bank and let their representative explain their procedure and features. Later, they ask you to submit documents for KYC, and once this is done, the lender will take forward your request. In case of missing documents, you must submit hard copies and ensure to procure the remaining ones. You would have to wait for days until they check your application and credit score, and the loan disbursal process may even take a few days. This is quite a time-consuming procedure.

But as opposed to traditional bank loans, the online world has made it easy and, not to forget, completely safe to apply for a loan and get disbursal within minutes. In fact, some fintech companies make loan disbursal possible within 10 minutes!

Online lenders have apps where you can browse all available personal loans. To apply, you would need to upload soft copies of the required documents on their app or website, which takes about a few minutes. Upon verification, your eligibility is authenticated and the loan is available in your account within minutes. Depending on your eligibility, some lenders might take a day to disburse your loan amount.


What are the Advantages of an Online Loan?

Stepping out of your home or taking out a particular time to get a loan is a thing of the past if you choose a trusted fintech lender for an instant online loan. Here are six reasons why you should get a personal loan approved from an online lender:


Low-income Requirement

Managing expenses post-pandemic has been a major challenge for most people, especially the low-income strata. Income losses, salary cuts, and job losses have been standard for many. In such a scenario, meeting the income requirement set by banks can be difficult. Online lenders allow a loan for low-salary individuals, depending on their policies.


Contact-less Approvals

Another big advantage of an instant online personal loan is zero-contact approvals. Online lenders have an application or website where you create an account, upload the necessary KYC documents, verify your identity, and get a loan based on your eligibility. So yes, you don’t have to go anywhere physically!


Instant Loan Disbursal

If you have ever taken out a bank loan, you would know the struggle of making multiple trips to the bank to get it approved. This struggle is no longer valid with an online loan. All you have to do is get the app or log in to their website, complete the necessary verification procedure, submit required documents, and get the loan amount disbursed into your bank account within minutes – sometimes even 10 minutes is all it takes!


Flexible Loan Tenure and Amount

Your online loan amount, tenure, and interest rate differ from lender to lender and depend on your credit score and repayment capacity. But compared to traditional bank loans, you get more options to explore. Some fintech companies allow loan disbursement between ₹1,000 and ₹3 Lakhs.


Simple Application Process

Applying for a personal loan on an online lending platform is simple and quick. They have an app to download. Once you log in, verify your identity, select a plan, get a check for eligibility, and upload documents. After document approval, the loan amount is added to your bank account within minutes.


Available Even on Low Credit Score

One of the major deciding factors for loan approval is your credit score. Sometimes a bad or poor credit score (below 650) can get your loan request rejected when applying for a bank loan. In contrast, some fintech companies provide loans on a poor credit score by assessing your creditworthiness.


What Else to Keep in Mind?

With an online instant personal loan, submitting documents becomes a hassle-free process as you won’t have to make several trips to the bank to present papers. Document and verification proof is submitted as a soft copy. Moreover, banks tend to take hefty penalties for pre-payments made before the completion of one year. This is not the same for online loan lending fintech companies. Depending on their policies, some may allow you to make pre-payments on your unsecured personal loan to close it before time without penalties.

Leave a Reply

Your email address will not be published. Required fields are marked *