The High Growth of Personal Loans - Here’s Why - Kotak Bank

11 MARCH, 2020

Today, there is steep rise in the number of people opting for personal loans in India. Personal loans are a type of unsecured loans and are generated for people who wish to fund their personal needs. It can be used to finance any need including paying medical bills, funding a wedding, serving the expenses of a vacation or just about anything. It is important to consider certain factors such as the interest rate, the processing fees, and the terms and conditions.

The high growth in personal loans can be explained by the different aspects and they include:

Quick processing – When in immediate need for funds, people usually turn to personal loans. They are processed at a much faster rate as compared to other kinds of loans. It is easily accessible and the documentation isn’t too elaborate. You do not have to gather too many documents making it a simple and faster process.

No collateral – A collateral is an asset that must be provided to the lender as a form of security when seeking a loan. In many emergency cases, it can be extremely difficult to produce a collateral. Personal loans are unsecured and thus, you do not have produce a collateral. However, the ability of the borrower to repay the loan is taken into account and you must meet the specified criteria.

Convenient repayment term – The repayment terms offered with personal loans are usually very flexible. Depending on the total loan amount, the term can run anywhere between one to five years. Usually, the payment must be fulfilled on a scheduled day of each month. This is a good benefit for people who wish to budget their expenses.

Debt consolidation - Personal loans can be used to finance any purpose and thus, it’s a suitable choice when consolidating debt. It can be used to pay off credit card debts or foreclose other kinds of high-interest loans. You can essentially pay off you debt in one EMI over keeping tab of several EMIs.

Offered online – You can apply for a personal loan online. Just like the tradition loan lending process, it requires minimal documentation and is an easy process. The amount is transferred directly into the bank account for convenient usage.

Personal loans are offered by a wide range of financial institutions, however, the features may differ. Ensure that you pick a suitable lender that fits all your needs. Additionally, you must be careful of your financial plan when seeking a personal loan. Getting a personal loan is a fairly easy process and this can trap you into utilizing the funds on expenses that are unnecessary. It can push you into a debt trap if not used wisely.

Read more about how to make the best use of personal loans here.

Latest Comments

Leave a Comment

200 Characters

Related Information


Read Next

medical-emergency-article

Quick Personal Loan for Medical Emergencies

Manage emergencies with quick personal loans. These loans are provided with quick disbursals. 

marriage-hero-article

Avail Personal a Loan While Getting Married

Getting a personal loan for marriage is easy and repayment for a marriage loan is flexible.

is-securing-your-childs-future-a-childs-play

Personal Loan for Home Renovation & Improvement

A personal loan for home renovation is quick along with competitive interest rates and flexible tenures. 

Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.

Ready to take the next step?

icon

Frequently Asked Questions

What can a personal loan be used for?

Personal Loan can help you meet unexpected expenses such as wedding expenditure, school or college fees, dream vacations, home renovation projects or even for the purchase of consumer durables. 

 

Applying for a personal loan is a lot easier, quick, and convenient with Kotak Mahindra Bank.Click https://www.kotak.com/en/personal-banking/loans/personal-loan.html to apply for the same. 

 

Was this information helpful to you? Yes No

Do I need to provide any security or collateral to obtain a personal loan?

No, you do not have to provide any security or collateral to obtain a personal loan. Personal loan is a type of unsecured loan. This essentially means that it is not backed by the guarantee of collateral. You are not burdened by the need to generate collateral like gold, property or shares, as with other types of loans. As there is no security to assure loan repayment, the bank will focus on the income and financial stability of the applicant. 

Was this information helpful to you? Yes No

What are the benefits of taking a personal loan with Kotak?

There are several benefits of availing a personal loan from Kotak bank. Some of the most notable benefits include:

  • prepaymentInstant approval – The bank approves the loan at a quick rate and this makes the process much easier to serve different financial purposes.
  • Easy Documentation – It comes with minimal documentation requirements to help you save time and cater to your emergency financial needs without any hassle.
  • Versatile usage – The personal loan can be used to fulfil many purposes. From funding a dream wedding to serving a medical emergency, it can be used to serve different planned and unplanned financial needs.
  • Attractive interest rate – The personal loan is made more convenient with an attractive rate of interest starting at 10.75 p.a.
  • Part Prepayment facility – In case of excess funds/financial liquidity , you can reduce your loan burden with part prepayment

Was this information helpful to you? Yes No

What is the eligibility criteria to apply for a personal loan?

The eligibility to avail Personal loan is as follows :

  • All Indian residents who are employees of either MNCs, Public and Private limited companies with a minimum age of 21 years and maximum age of 58 years are eligible for a personal loan.
  • Other Personal loan eligibility criteria :
    • Income Net monthly salary of Rs. 20,000/-
    • Minimum educational qualification - Graduate
    • Years in city - Minimum 1 year
    • Total work experience - Minimum 1 years

You can apply for a personal loan by following the below steps:

On Mobile banking

  • Go to Apply Now
  • Personal Loan ( If eligible)

On Net Banking

  • Go to Banking
  • Apply for Preapproved Personal Loan (If eligible)

Or

By simply clicking https://rcasprod.kotak.com/personal-loan?source=website&banner=ProductPageApplyonlineTab

Please Note: The same would be subject to approval. The time frame for the personal loan is 10 working days if approved.

Was this information helpful to you? Yes No

What is the best way to apply for a personal loan?

You can apply for a personal loan by following the below steps:

 

On Mobile banking

  • Go to Apply Now
  • Personal Loan ( If eligible)

On Net Banking

  • Go to Banking
  • Apply for Preapproved Personal Loan (If eligible)

Or

By simply clicking https://rcasprod.kotak.com/personal-loan?source=website&banner=ProductPageApplyonlineTab.

Please Note: The same would be subject to approval. The time frame for the personal loan is 10 working days if approved.

Was this information helpful to you? Yes No

People also looked at