Top Benefits of Small Loans: Instant Financial Support Without the Hassle
Small loans are becoming popular in India. You can use these loans to fund your emergency financial requirements. The procedure involved in getting these loans is relatively easier than regular bank loans. Faster approvals of these loans ensure that you get the money faster. There’s less paperwork involved. This article will explore the top 5 benefits of small loans.
Top 5 Benefits of Small Loans
Here are the top 5 benefits of availing small loans.
1. Quick Approval
The best thing about small loans is that they can be approved within a few days. Some financial institutions claim to approve small loans within 24 hours, which is faster than regular bank loans.
That is because of less paperwork involved and relatively less stringent eligibility rules. With IDFC FIRSTmoney personal loans online, you can get a line of credit up to ₹10 lakhs approved fast. How much you actually get approved for depends on your credit record and other factors. But the online process is quick.
2. No Requirement of Guarantor
Most financial institutions offering small loans in India do not ask for a guarantor or collateral, making the whole loan process hassle-free. With IDFC First, you do not need a guarantor if your credit score is 730+ and you meet other basic eligibility criteria.
The loan gets sanctioned and is directly disbursed to your bank account. A small loan is particularly beneficial for individuals who may not have assets for collateral or know someone who can guarantee their loan.
3. Minimal Documentation
The documents required for securing a small loan are minimal compared to those needed to ensure a traditional bank loan. Most financial institutions extending small loans would require you to provide essential KYC documents like ID proof, address proof and bank statement(s).
4. Flexible Usage
Small loans give you flexibility in the usage of your loan funds. You can use the loan for any legal short-term needs like medical expenses, home repairs, weddings, and travel expenses. There is no requirement to furnish details to your loaning institution. The flexible end-usage makes small loans convenient for covering various needs.
5. Competitive Interest Rates
With multiple financial institutions offering small loans, you should compare interest rates and charges to find a deal that best fits your budget. The interest rates usually start from 11% per annum onwards, depending on your eligibility criteria. If you repay your loan on time, small loans can prove to be more economical than other financing options for covering urgent needs.
With IDFC FirstMoney, you must pay interest only on the amount you borrow, not on your entire credit limit. Please note that the loan terms (including interest rate) you finally get depend heavily on your creditworthiness.
Summing Up
Small loans empower you to meet pressing financial needs efficiently. These loans come without restrictive eligibility criteria or high interest rates. From quick approval to minimal documentation, small loans score high on convenience. They provide quick access to emergency funds.
