Factors to note when applying for a medical loan | Personal Loan Stories - Kotak Mahindra Bank
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11 MARCH, 2020

The cost of medical care and services is always expensive, especially when one requires urgent and long term hospitalization. During such testing moments, health insurance taken by you for yourself and your family members can be the ultimate savior. However, there are times when medical expenses run too high. In such cases, the exorbitant bills may not be completely covered by the insurance provider. This is when you can opt for a medical loan.

A medical loan is a type of personal loan that covers your medical expenses, especially during an emergency. Many banks and financial companies provide medical loans to individuals in need. Fortunately, most banks today have also streamlined their procedures so that the loan is disbursed at a much faster pace.

Here are some things to know when applying for a medical loan:

Make a rate comparison

Many banks charge different interest rates for a medical loan. The interest rate gaps can be huge and could majorly impact your savings. Hence, it is important to make a rate comparison of different banks and financial institutions that provide medical loans. Post analysis, pick the one which brings you the best value.


Make sure to know what documentation is required by the bank or the financial institution in order to get the loan approved. The most common documents needed will be proof of address such as Aadhaar card, driver’s license, passport or PAN card. Bank statements, salary slips or income tax returns will be required to access proof of income.

Affordable EMIs

It is wise to use a personal loan EMI calculator to check and compare the EMIs of different banks and financial institutions before availing a medical loan. The payable EMI will vary depending upon the loan amount, interest rate and loan tenure.

Other charges

Banks and financial institutions usually charge certain fees like processing fees, re-payment charges, pre-closure charges, dishonor charges and penalty charges to name a few. So before applying, research and compare the various fees levied by different financial institutions.

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Credit score

Your credit score could impact the interest rate that is charged on your medical loan. A good credit score will let you negotiate with your lender for a better rate of interest. So before applying for a loan, it is important to check your credit score.

Avoiding delays in getting medical loans

Provide valid documents

One important reason for the delay in the approval of medical loans is the lack of proper documentation on the part of loan applicants. As a loan applicant, it is essential to provide authentic address and income proofs as demanded by the bank.

Choose banks known for quick loan disbursal and smooth procedures

Make sure that the bank you choose to apply for a personal loan for a medical emergency has a reputation of disbursing loan amounts without any delays. After all, you do not want to face delays when stressed by a medical emergency.

Also, some banks still follow cumbersome procedures of approval of medical loans which leads to delays. It is advisable to first research about the bank and the loan approval procedures before deciding on the right pick. It also serves well to check customer feedback and reviews with regard to the bank, to be sure about the same.

Read more: Manage your medical emergencies with personal loans here.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. 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 the Bank. The Bank, 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. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.