Do you need an instant loan for a financial emergency? Well, you could apply for a personal loan which could take anywhere between one to a couple of days. And you could get the money in your bank the same day also if you are lucky and importantly, if you have all the necessary documents ready.
The key documents that are required to apply for a personal loan include, but not limited to, past three-months' salary slips, Form 26AS of past two years, PAN, address proof, ID card. The lender also checks your credit score before processing your application.
Once you submit these documents, the bank's credit department makes your application go through some checklist during which they could ask you for some more documents such as an appointment letter and a letter from the HR department confirming your association with the company.
After these checks are done, you can expect your application to be approved following which the loan would be disbursed. The other option is to apply for an instant loan instead.
It is a personal loan wherein the loan amount is disbursed instantly to the account of the borrower. Several fintech apps and some banks offer instant, or insta, loans for the convenience of borrowers so that they can quickly access loans without having to physically visit a bank or having to chase a banking agent for the same.
Typically, instant loan is a good and convenient option for any one who has a good credit score, holds a PAN card, an Aadhaar and has a mobile number linked to Aadhaar. In other words you have a credit history and are KYC-compliant. So, a bank or NBFC or fintech app does not have to do much before checking your creditworthiness.
They can authenticate your identity by making you enter the OTP sent on your mobile number linked to the bank before disbursing the money.
However, it is important to note that these loans are of small value and carry a slightly higher rate of interest. Some NBFCs and fintech apps offer higher denomination of loan based on repayment of your previous loans with those platforms. And importantly, the loan amount is also a function of your net monthly income and credit score.
First of all, you need to decide which insta platform you need to opt for. The ideal thing is to go for a bank with which you share a long lasting relationship. There would not be any "hidden costs", you are likely to be aware of their customer support service and it is an RBI-compliant large financial institution. The only option is to approach an NBFC or a fintech mobile app which offer an ease of application.
It is noteworthy that some of the fintech lending apps were found to be fake and spurious. So, you must first be sure of the app's credibility before you apply for a loan with any fintech app.
Additionally, fintech apps are supposed to be RBI complaint. So, it is recommended to apply for a personal loan only with a RBI-approved NBFC or P2P lending platform.
It is noteworthy to mention that the RBI on August 16, 2024 revised a set of rules on P2P platform in view of the breach of the then existing regulations by some non banking financial companies. You can check the latest rules here.
Once you have zeroed in on the platform you want to apply for. You can apply for the loan amount, enter your details including your name, PAN, profession, employment details. The platform will run an identity check and examine your credit score before deciding to approve (or in some cases reject) your application.
Additionally, every digital platform has its own unique user interface, eligibility criteria and other requirements. So, one is supposed to check the details at the respective platform before deciding to take a plunge.
