What Makes Personal Loans So Popular Among Borrowers?

Personal Loans are typically offered as unsecured loans by NBFCs like Poonawalla Fincorp and other fintech institutions to eligible borrowers looking for prompt financial assistance to meet personal needs. However, with digital lending gaining popularity over the last decade, the processing and disbursal time have been drastically reduced. Now you can get instant loan online for personal needs with minimal documentation and quick disbursal if your monthly income, credit score, etc., align with your fintech provider’s eligibility criteria. Also, you can get low-interest Personal Loans with a high amount based on your repayment capacity and previous credit history.

According to numerous surveys, the number of applicants looking for Personal Loans in India has been on the rise in the last decade. The fact that Personal Loans are instantly available without collateral, affordable interest rates, and minimal documentation might be some of the reasons behind such colossal demand. Moreover, these loans can be used for any purpose, from medical emergencies to weddings, from buying a car to paying for higher education. 

Hence, Personal Loans have become very popular, especially among salaried individuals. Let’s discuss the top 6 reasons why Personal Loans are so popular among borrowers in India.  

Top 6 Reasons why Personal Loans have become popular

1. You can get Personal Loans online

Several NBFCs and other fintech institutions offer Personal Loans as instant loans online. Also, before applying for a personal loan online, it is advised to use an EMI calculator to compare and choose lenders that offer the best low-interest Personal Loans. Moreover, you can submit all the required documents online; hence, you don’t need to visit the NBFC to get the loan physically. Once the document verification is a success and the lender approves the loan amount, you will get the funds credited to your account within 24 to 48 hours.  

2. No collateral required

One of the top reasons why personal loans are so popular is the fact you can apply for instant loans online without putting up any collateralAs these are unsecured loans, you don’t need to pledge any property or other valuable assets to get approval. Also, the loan processing time becomes much faster due to minimal documentation. The only factors taken into consideration for personal loan approval are monthly income, credit score, and repayment capacity. 

3. No restrictions on end usage

One of the perks of availing of Personal Loans as instant loans online is that you can utilise the funds for any purpose. Unlike car loans or home loans that can be used for the assigned purpose, Personal Loans have no restrictions whatsoever. You can use the funds for travel, home renovation, wedding, buying machines, funds, medical emergencies, education, etc. 

4. Debt consolidation

Debt consolidation is a major reason why people opt for a Personal Loan. Whenever you apply for instant loans online and use the funds to pay other loans or credit card payments, you combine those debts into one monthly payment. This method of repayment makes it easier for you to make suitable plans for repayment of the entire amount without feeling overburdened. In addition, the low-interest Personal Loans can help you repay the other loan amounts, which have higher interest rates, thereby saving a lot through the tenure.

5. Minimal documentation

Personal Loans are mostly unsecured, nor are you required to submit too many documents to these instant loans online. NBFCs and other fintech institutions will ask for documents such as property sales deeds, rent agreements, etc. when you apply for secured loans, but in the case of Personal Loans, there are no such requirements. So many applicants prefer Personal Loans due to minimal documentation requirements. You need to submit just KYC docs like ID proof, residence proof, and income proof to get low-interest Personal Loans.

6. Flexible repayment terms

The repayment tenure for instant loan online typically ranges between 1 year to 5 years. You can opt for tenure based on your repayment capability, provided your lender agrees to it. However, you must understand that loan interest rates will increase as you go higher on the repayment tenure. Also, if you get instant loans online and repay the EMIs within the term, your credit score will improve and increase your chances of getting future loans without any hassle.The above reasons clearly prove that Personal Loans are the most popular types of loans that people can get with minimal fuss. As it is collateral-free and requires minimal documentation, you can sit in your home and apply for instant loans online and get your approval in a short period. Moreover, as these loans are needed during emergencies, NBFCs like Poonawalla Fincorp ensure processing is quick, and your loan amount credited to your account quickly.

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