21 November, 2024 | 11:01 IST
The process of availing a loan earlier used to be lengthy due to physical filing of documents and verification. With the emergence of digital lending apps it has become quite easy to get an instant personal loan. You can get instant loan approval if you have a high credit score and a healthy credit history.
Most of the lenders offer instant loans based on the income level, credit history and credit score of the borrowers. You even don’t need to provide any security or collateral against such loans.
Let’s take a look at how to get instant loan and the key factors you should take into account before finalising a loan offer.
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Instant loans are short-term loans which can be availed to meet immediate financial needs. These types of loans are typically ‘unsecured’ and do not require any form of collateral. Instant loans are fast and convenient and are offered by banks, non-banking financial companies (NBFCs). Depending on the institution from which the loan is availed, the instant loan can be disbursed in a time period ranging from a few minutes to a few hours.
The process of getting an instant loan approval is straightforward and simple. You just need to have a good credit score and a healthy credit history. The lenders also take into account your income level. You can avail an instant loan by uploading your documents and setting up the payment for equated monthly instalments (EMIs).
You can access multiple loan offers on digital platforms like Moneycontrol. Through the Moneycontrol app and website, you can apply for a personal loan through a 100% paperless process. The loan interest rate starts at as low as 12% per annum. The Moneycontrol app gives access to loan offers through its lending partners.
Here’s a look at the documents required for availing an instant loan:
ALSO READ: Emergency loan apps: Check Pros and Cons before borrowing
The interest rates for instant loans vary from lender to lender. The interest rates for instant loans generally range from 10.75% to 42% per annum. The interest rates depend on multiple factors like loan amount, tenure and borrower’s credit score. A high credit score and healthy credit history helps to secure an instant loan at a lower interest rate.
The repayment period or tenure for instant loans also differs from lender to lender. Generally instant loan tenure may range between 6 months to 5 years.
Instant loans offer a quick access to money and can oftentimes be processed and disbursed within a few hours as many lenders offer both same-day and next-day lending services.
Instant loans usually require relatively less paperwork compared to traditional loans, making the application process more convenient.
Instant loans are unsecured, thus borrowers do not need to provide any asset as a security against the loan. Instant loans are flexible in nature and borrowers can use the money for various purposes such as travel, emergencies, weddings, big-ticket purchases, home renovation and other such purposes.
Instant loans offer quick access to money and this could be helpful in case of a cash crunch. The process of getting an instant loan not only involves knowing the steps for availing a loan but also understanding the nuances of such borrowings. Borrowers should be fiscally wise and avail instant loans only when the money is needed the most. Reckless borrowing may push you into a debt trap while negatively impacting your credit score. It’s advisable to check the terms and conditions of the lender and all the fees and charges before availing the loan. The borrowers also should be careful about fraudulent practices over instant loan approvals.
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