Financial emergencies can hit at any time. Their unexpected nature makes them deadly. It rears its head during medical exigencies, unexpected car and home repairs, accidents at home, and more. These emergencies can put a great deal of stress on an individual, especially when the required funds are not available to meet these expenses. During these times, borrowing in the form of personal loans is a great way to tide over difficult financial times. Personal loans offer a number of unique advantages that make them an ideal form of credit, particularly during emergencies.
This article looks at personal loans in more detail and why personal loans are an ideal choice especially during a liquidity crisis.
#1 Ease of Access
One of the major advantages of a personal loan is the simplicity of the borrowing process. Most banks and lending institutions have a simple application process. Additionally, this process can be undertaken online with the help of mobile apps. Applicants can complete the online personal loan application process, upload their documents, and choose their respective loan amounts – all within minutes. This is perfect for individuals who don’t have the time to visit a physical bank and can process their loans from the comfort of their home.
#2 Quick Loan Disbursal
Another benefit of a personal loan is that it can be processed quickly. Lenders are known to disburse loans as quickly as 24hours after getting approval for the loan application. This is great for individuals looking for quick and easy access to funds, during times of emergency.
#3 No Collateral Required
Individuals needn’t bother with submitting collateral when applying for personal loans. This is great news for borrowers who don’t have assets that can be used as collateral to back up their loan applications. Banks and lending institutions will lend on the basis of the borrowers’ merit like credit history and income rather than demanding any form of collateral.
#4 High Loan Amounts
Borrowers can avail of large loan amounts up to ₹25,00,000 in the case of NBFCs. Borrowers can use this amount to fund a number of costly requirements. Banks and lending institutions will generally not question what the borrower will use the funds for. After all, it is “personal” in nature, and individuals who meet the eligibility requirements are entitled to loan amounts based on various factors.
#5 Attractive Interest Rates
Banks and NBFCs offer a range of unsecured loans and are vying to gain an upper hand in the market. This has brought about a great deal of competition in the market. In order to gain an upper hand, banks and NBFCS are offering personal loan interest rates at attractive rates. This competitive market spirit has resulted in the customer gaining the upper hand with attractive rates. When compared to other loan products and credit card interest rates, personal loans are still relatively cheaper in the longer term.
It’s no surprise that individuals use personal loans as a means to consolidate multiple smaller loans and credit card bills. Personal loans can be a great way to finance short-term debt and tide through financially difficult times. For more detail on personal loans visit the Bajaj Finserv Markets website for complete details on online personal loans and the latest interest rates.