15 February, 2025 | 11:01 IST
A personal loan could be helpful in meeting several unexpected expenses from a medical emergency to home renovation. With the rapidly growing digital lending sector in India, availing a personal loan has become quite easy. You can apply for a personal loan through your smartphone and receive the amount in your bank accounts within a few hours. Even many instant loan apps process loan disbursements within a few minutes.
The digital lending platforms solely depend on electronic verification of documents, known as e-KYC process. This tech-driven process has significantly reduced the time for processing loans with quick verification of identity and address proof documents of an applicant.
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The ‘Know Your Customer’ (KYC) process is a mandatory framework used by the banks and non-banking financial companies (NBFCs) to verify the details about their customers. When the entire process is carried out through an electronic mode, or via digital platforms, it’s known as e-KYC. It involves collecting personal information such as name, address, date of birth, and identification documents (like a passport or driver's licence) of a customer. The goal of KYC is to prevent fraud, money laundering and financing of illegal activities like terrorism, by authenticating the personal details of an individual for the purpose of all financial transactions. It's a standard practice for banks, online service providers, and even for some government agencies. E-KYC process allows individuals to verify their identity online using scanned documents online instead of physical paperwork. It is commonly done using Aadhaar-based verification in India, where users authenticate themselves through OTP (One-Time Password), biometric scans, or Aadhaar-linked data.
E-KYC (Electronic Know Your Customer) has made applying for personal loans faster and hassle-free by enabling instant identity verification through digital means. Financial institutions and fintech platforms widely use e-KYC to streamline loan approvals.
For example, digital lending platforms like Moneycontrol, allow applying for personal loans through an e-KYC process. You can apply for personal loans up to Rs 50 Lakhs from eight lenders through the Moneycontrol app in a 100% paperless process. The interest rates for these loans start at 10.5% per annum. You just need to finalise the loan offer, complete the e-KYC verification and set up the EMI payment, to receive the amount in your bank account.
There are multiple methods of KYC verification for loans offered via Moneycontrol
Some lenders may require you to complete a Video KYC.
Here are the eligibility conditions for e-KYC for personal loans:
The e-KYC process has completely changed the lending scenario in India. You can now avail a personal loan almost instantly without the need to visit the branch of a bank or physical submission of documents. However, it’s important to follow due caution while completing the e-KYC process to avoid the risks of cyber fraud. It’s advisable to apply for loans and update KYC details only through digital lending platforms approved by the Reserve Bank of India (RBI).
ALSO READ: Instant loan apps: Here’s what you should know about risks and precautions to take
If you are looking forward to applying for a personal loan, you can visit the Moneycontrol app or website to check loan offers up to Rs 50 Lakhs from eight lenders. It’s a completely paperless process and the interest rate starts at as low as 10.5% per annum.
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