A loan is a sum of money that is borrowed and that is expected to be paid back with interest in the form of Equated Monthly Installment (EMI). There are varieties of loans currently available in the market which includes personal loan, home loan, vehicle loan and education loan. However, all these loans take specific time for approval once an individual files its application.
On the other hand, with changing financial landscape, several innovations in the loan market are providing ease to customers. One such trend which is currently gaining momentum in the loan market is ‘Instant Loan’. This type of loan can be borrowed instantly from any bank or institution.
So, let’s find out what are instant loans and things you must keep in mind while opting them:
What is Instant Loan?
An instant loan is basically a personal loan which is made available ‘instantly’. They are approved really fast, without the need of any guarantors, collateral. The best part is one can also save them from excessive documentation. These are more commonly applied and approved online with all necessary documents being sent via e-mail and verified online as well.
For example, if you are in urgent need of money just before a marriage ceremony or any medical needs or any large purchases or even a quick cash requirement for your business, then such type of loans prove to be the best option.
An instant loan generally covers:
- Unforeseen wedding expenses
- College fees
- Home and vehicle repair expenses
- Sudden medical expenditure
- Quick cash infusion into a business
- Instant requirement to purchase large assets, etc
While an instant loan does not require a good credit history, there are still certain eligibility criteria which banks and financial institutions look upon:
- A person must be at least 18 years old at the time of loan application.
- A person must draw a net monthly salary or making business profits of:
- 40,000 if you live in Delhi/NCR, Mumbai, Hyderabad, Bangalore, Chennai or Thane.
- 35,000 If you live in Ahmedabad, Pune or Kolkata.
- 30,000 if you live in any other city in India.
However different banks and lenders require different incomes in this regard.
- A person must have an operating savings bank account.
- A person must be a resident of India.
Following are the set of documents you need to submit while applying for instant loan:
- Photographic identity proof
- Passport and stamp sized photographs
- Address proof, Signature proof, Age proof
- Current employment and previous employment
- Financial bank statements of last 3 months
- Employment proof
Benefits and advantages
- It is an unsecured personal loan.
- It can be availed instantaneously
- No credit-check or CIBIL inquiry
- Minimal documentation
- No collateral/ guarantor required
- Fast processing, with waiver of processing fees in some cases
- Flexible repayment options
- Part prepayment facilities with minimal or zero pre-closure charges
- Pre-approved offers for existing customers in most banks
- Loans approval from 1 lakh to 25 lakh
- Online account access to check real time updates.
- Insurance cover like complimentary personal accident cover and credit shield facilities
Following are the steps which need to be followed while applying for instant loan:
Step 1: Fill in the online application form or a hard copy of the application form available at the nearest bank.
Step 2: Wait for conditional approval. Once approved, a formal mail will be sent to you from the bank asking for a set of documents.
Step 3: Know Your Customer (KYC) and document collection. Once you receive your approval, you must collect all the required documents and send these via e-mail, which makes the process faster.
Step 4: Credit to your account. Once the documents have been verified by the bank, the amount requested will be instantaneously credited to your regular salary / business account.
The maximum time all these process require is of 72 hours. However some banks complete the process in 48 hours or some just take few hours only.