The way people avail loans in today’s digital age is significantly different from how it used to be done before. . In the traditional loan process, loan seekers had to go to the bank multiple times, wait in long queues and submit numerous documents for verification. And even after undertaking all of this, there was no certainty that a loan would be approved.
However, with the advent of digital lending platforms, loan applications can now be completed in as little as 15-20 minutes and all one needs for that is a smartphone. Borrowers can take advantage of various benefits associated with the digital loan process, but there are a few things they should keep in mind before applying for a digital loan.
Choose carefully: There is a plethora of lenders available in the market, all eager to entice borrowers with lucrative loan deals. However, not all offers are suitable for everyone. Thus, borrowers should not be persuaded by flashy advertisements or grand promises that make the loan attractive. Rather, they should spend time researching the lender as well as the many personal loan products on offer. Then, based on facts and analysis, borrowers should evaluate different loan products from various lenders and choose the one that suits them best.
Reimbursement/flexibility terms: Borrowers should ensure that they have flexibility in repaying their EMI loans, both in terms of EMI amount and repayment methods. When a person applies for an immediate loan online, they are usually looking for a way to get out of debt. Therefore, care should be taken not to end up in a situation where the loan provider’s repayment plan is so rigid that it causes further distress to the borrower. Borrowers should be allowed to choose their repayment term based on their repayment capacity. Borrowers should also have the option of prepaying portions of their borrowed amount so that if their income increases or they wish to pay off their debts sooner, they should be able to increase their EMI or make a larger repayment. Additionally, borrowers should be able to choose from a variety of repayment options, such as UPI, wallets, online banking, and cards.
Delay of treatment : Instant loans are often distinguished from other forms of loans by the speed with which they are processed. However, since instant loans also require pre-verification, companies offering them online may take longer (up to 48 hours) to process a loan application. So, before selecting a digital loan provider, it is always a good idea for borrowers to consider how long it will take for the funds to be credited to their bank account.
Check credibility: Before availing a loan, a borrower should research and inquire about the credibility of the lender. To do this, they need to look at customer testimonials, read negative and positive reviews on the app store, count the number of credible lenders on the platform, and determine the number of customers, which can be easily compared to the number of ‘facilities. In addition, one should also check whether the platform is affiliated with a verified bank or is a verified lender registered with the Reserve Bank of India.
Transparency of operations: The loan provider must be transparent when it comes to disclosing details such as processing fees, loan term and offers, as well as documents such as loan sanction letter and name of the loan provider. lending entity in the loan agreement. Additionally, an app providing loans for shorter terms without implementing KYC or providing fee details or legitimate addresses calls for caution and borrowers should beware.
Although the above points may seem obvious, many people still approach the loan application process completely unaware of these factors, which should not be the case. In this fast-paced, ever-changing, technology-powered world, it’s important to keep these tips in mind to get the best and safest online loan deal possible.
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