Paperless Personal Loan: Get the Money You Need Easy And Fast

Aug 28, 2023 / Reading Time: Approx. 7 mins

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Paperless Personal Loan: Get the Money You Need Easy And Fast

A Personal Loan, an unsecured credit facility that can be obtained from a bank or a Non-Banking Financial Company (NBFC), serves as a lifesaver in times of financial emergency. The biggest advantage of getting a Personal Loan is that it is a collateral-free loan that can be utilised for any legitimate purpose. Since there are no restrictions on the end-use of the Personal Loan amount, the money can be directed toward various purposes, such as covering a child's educational expenses, buying the latest smartphone, renovating a house, expanding a business, and more.

Recent technological advancements have brought about substantial changes. Activities that previously required significant effort can now be accomplished with a few clicks, thanks to innovations in the tech realm. This includes transformations in the banking sector as well. People are now seeking efficient and instant solutions for their banking requirements instead of waiting outside the bank branch for long periods.

Moreover, with the Indian government's push for digital transactions across customer segments, most banks and NBFCs are transitioning to paperless Personal Loan approval. Leading lenders like HDFC Bank, Axis Bank, SBI, and ICICI Bank are now offering easy yet secure online processes for approving Personal Loans, eliminating the need for paperwork, and ensuring a seamless borrowing experience.

All these financial entities heavily rely on innovative digital technologies to enhance customer service and eliminate the burdensome administrative aspects associated with documentation. Paperless Personal Loans have proven beneficial to customers, ensuring access to necessary funds during financial emergencies.

Click here to download PersonalFN's "Your Definitive Guide to Avail of a Personal Loan in India" for free!

[Read: How to Get a Pre-approved Personal Loan in 5 Easy Steps]

[Read: How to Use a Personal Loan Calculator Effectively a User-Friendly Guide]

[Read: 9 Most Important Questions to Ask Before Applying for a Personal Loan]

[Read: 5 Reasons Why a Personal Loan Can Go Wrong]

[Read: Do Not Make These 11 Mistakes When Taking a Personal Loan]

[Read: 8 Sure-fire Ways to Improve Your Personal Loan Eligibility]

[Read: Is Opting for a Personal Loan Better Than Borrowing From Friends & Family?]

[Read: 8 Effective Strategies to Reduce the Cost of Your Personal Loan]

What Is a Paperless Personal Loan?

Availing of a Personal Loan is an efficient strategy to meet your pressing financial requirements. This type of loan doesn't require collateral, which makes it an unsecured loan. Besides, as discussed earlier, most personal loans come with the advantage of not imposing limitations on how the funds are used. This versatility allows them to cover various financial demands such as weddings, education, high-end purchases, medical emergencies, or even vacations. To initiate the application process for a Personal Loan, you typically only need to provide essential documents such as proof of ownership, income details, and your address. Apart from this, lenders also have prerequisites such as a consistent monthly income and a favourable credit score.

A Paperless Personal Loan is as easy as booking movie tickets online. Borrowers are required to complete an online application and submit scanned copies of the necessary documents, and once the loan is approved, the funds are promptly transferred to the borrower's bank account.

What Are the Key Features of Paperless Personal Loans?

1. The entire process is conducted online, eliminating paper forms and physical visits to the branch.

2. Soft copies of the required documents are submitted online.

3. Faster processing due to automated verification and minimal paperwork.

4. Reduces paper usage, aligning with environmental sustainability.

5. Lower operational costs, leading to potential savings for borrowers.

6. Reduced risk of document loss with digitised processes.

7. Online Personal Loan EMI Calculator assesses loan eligibility based on provided information.

8. Approved funds are transferred directly to the borrower's account.

9. It can be accessed from anywhere, streamlining the borrowing experience.

10. Existing customers may qualify for pre-approved Personal Loan offers that do not need documentation and can be disbursed within a few seconds.

What Are the Benefits of Opting for a Paperless Personal Loan?

Instant Paperless Personal Loans offer numerous benefits, some of which are outlined below:

1. Elimination of Paperwork:

With the entire process conducted digitally, customers do not need to visit a branch to submit hard-copy applications physically. This facility spares them from dealing with multiple forms.

2. Swift Disbursement:

The digital platform for personal loans has significantly accelerated the process. The loan amount is immediately disbursed after the lender validates the digital documents. Existing bank customers might even gain access to pre-approved Personal Loans that may not even need digital copies.

3. Environmentally Conscious:

One of the objectives behind the promotion of Paperless Personal Loans is its environmental friendliness. As the process fully embraces digital operations, banks can cut down on paper consumption, embracing an eco-friendly stance. This aids in reducing carbon footprints and contributing positively to the environment.

4. Reduced Costs:

Another advantage of instant Paperless Personal Loans is that it allows lenders to slash overall expenses. Costs associated with paper and printing are virtually eliminated. Due to the reduced cost for them, the lenders can extend this benefit to the borrowers.

5. Enhanced Security:

The paperless approach stands as a more secure option compared to maintaining physical paper files. In the traditional method, the risk of losing crucial paper documents is prevalent. This risk is mitigated through the digitisation of the application and verification process.

How to Get a Paperless Personal Loan?

With the rise of the internet, banks and NBFCs now have a streamlined method for receiving and authenticating digital documentation from potential borrowers. Customers no longer need to physically visit the branch and do the paperwork to apply for a Personal Loan; instead, they can do all the formalities right from the comfort of their homes and get a Paperless Personal Loan with ease. While the exact Paperless Personal Loan application process may differ from lender to lender, it usually follows the 5 easy steps outlined below:

1. Navigate to the official website of your preferred lender:

Initiate the loan application process by visiting the authorised website of your preferred lender.

2. Fill out the digital application form with your personal information:

Complete the online application by inputting your personal details. This typically involves providing information such as your name, contact details, employment history, and other relevant particulars.

3. Upload digital copies of the required documents:

Upload digital versions of the necessary documents along with the loan application form. It may include identification proof, income proof, address proof, and any other documents that the lender deems necessary for evaluating the loan application.

4. Wait for the lender to verify the documents:

The lender will then proceed to validate the accuracy and legitimacy of the provided documents, ensuring that the information adheres to their requirements and criteria.

5. The loan amount will be transferred to your designated bank account:

After the validation of documents and approval of the application, the loan is ready for disbursement. The approved funds are then transferred directly into the bank account you have specified.

What Are the Documents Required for a Paperless Personal Loan?

Depending on the lender's terms and conditions, the following documents are required for a Paperless Personal Loan in digital version:

1. Identity Proof:

Acceptable forms include an Aadhar card, PAN card, Passport, Driving License, Voter's ID card, or any other valid identification displaying your name and photo.

2. Address Proof:

Suitable documents comprise Aadhar Card, Utility Bills, Passport, Ration Card, or Voter's ID card.

3. Employment Proof:

Furnish your current employment's work ID card.

4. Income Proof:

  • If you are a salaried individual, you are required to provide your salary slips from the last three months;

  • If you are self-employed, you need to furnish copies of your Income Tax Return (ITR) and audited financial records spanning the previous two years;

  • Furthermore, both salaried and self-employed individuals, along with businesses, are obligated to present their bank statements from the last six months.

What Are the Eligibility Criteria to Get a Paperless Personal Loan?

  • You must be an Indian citizen

  • You must fall within the age range of 21 to 58 years

  • You must have a minimum monthly salary of Rs 15,000 to Rs 25,000

  • You must have a good credit score, typically 750 or more

How to Calculate the Paperless Personal Loan EMI?

You have the option to compute your EMI manually using this equation:

EMI = P × r × (1 + r)n/((1 + r)n - 1), where P represents the loan amount, r is the interest rate, and n stands for the loan tenure in months.

Yet, you can bypass this complicated calculation by using our Online Personal Loan EMI Calculator. Input the interest rate, loan amount, and loan tenure, and within seconds, you will receive an accurate EMI estimate.

Click here to learn how to use a Personal Loan EMI Calculator effectively.

What are the factors to consider when applying for a Paperless Personal Loan?

1. Your Credit Score

Your credit score plays a crucial role in determining your Personal Loan eligibility. Maintain a commendable credit score that mirrors your creditworthiness by reflecting your past repayment track record. Try to settle existing debts promptly and close ongoing loans before seeking new credit. This practice will help in improving your credit score. A solid credit score (ideally 750 or above) is essential to secure a loan.

2. Alternate Offers

Before applying for a Personal Loan, make sure you assess the interest rates, eligibility criteria, and other pertinent factors of all available Personal Loan options. This step guarantees that you secure a loan with the most favourable terms.

3. Associated Expenses

Before finalising any agreement, meticulously review all expenses tied to the loan, such as interest rates, processing fees, prepayment & foreclosure fees, and late payment fees.

4. Your Repayment Capacity

Before taking the loan, determine your repayment capacity. Ensure that your income adequately covers monthly EMIs for a considerable period without causing undue financial strain. This assessment prevents creating a burdensome financial situation in the coming years.

To conclude:

Applying for a Paperless Personal Loan is an easy and convenient option, significantly reducing the complexities and time involved compared to manual loan completion. However, before deciding to get a Personal Loan, it's essential to assess your financial requirements carefully. It is advisable to avoid pursuing personal loans unless they are absolutely necessary, as frequent borrowing can put you in a debt trap that becomes difficult to come out of.

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KETKI JADHAV is a Content Writer at PersonalFN since August 2021. She is an MBA (Finance) and has over seven years of experience in Retail Banking. Ketki specialises in covering articles around banking, insurance, personal finance, and mutual funds and has been doing it for over three years now.

Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing.
This article is for information purposes only and is not meant to influence your investment decisions. It should not be treated as a mutual fund recommendation or advice to make an investment decision in the above-mentioned schemes.

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