Given the technological and digital advancements made by the banking system, Instant Personal Loans have become a reality as they are easily accessible for meeting various financial needs quickly. Whether it is for a medical emergency, home renovation, or a dream vacation, Personal Loan offers a way to access funds promptly.
In this blog, let us understand the Personal Loan disbursement process in banks, shedding light on the steps from application to the actual disbursal of funds.
What is the Instant Personal Loan disbursement process?
The Instant Personal Loan approval and disbursement process is designed to streamline and expedite the approval and distribution of loan funds to borrowers. Unlike traditional loans, which may take weeks for approval, these loans are tailored to provide quick access to funds, often within a matter of few hours.
Process of loan application
Application submission: It begins with a borrower applying for a loan at a bank or online lending platform. Typically, this application includes information about personal and financial circumstances, including details pertaining to income, employment status, and required loan amount.
Also Read: Smart borrowing: know when to use a Personal Loan
Document verification and credit assessment: The lender reviews the application and verifies the documents submitted by the borrower. It may involve checking proof of identity, income, residence, and employment.
Banks also evaluate the borrower's creditworthiness by assessing their credit score and financial history.
Personal Loan disbursement process
Loan approval: If the borrower meets the lender's eligibility criteria and passes the credit assessment, the loan application is approved. The loan amount is then determined based on the borrower's eligibility and requirements.
Agreement signing: Borrowers are required to sign a loan agreement, which details the terms and conditions of the loan, including the interest rate and repayment period. This can be done digitally, via e-sign and online agreements.
Disbursal: Once the agreement is signed, the loan amount is disbursed to the borrower. This can be done through various methods, such as a direct bank transfer, check, or digital wallet transfer.
Confirmation from the bank
The borrower receives confirmation from the bank or lending institution regarding the disbursal of the loan amount. This confirmation may include details of the disbursed amount and the expected repayment schedule.
Process post Personal Loan disbursal
Utilisation of funds: The borrower can use the disbursed funds for their intended purpose, whether it's for education, medical expenses, home improvement, or any other legitimate need.
Repayment commences: Typically, the borrower begins repaying the loan through EMIs as per the agreed-upon schedule. This schedule is outlined in the loan agreement.
Conclusion
In today's fast-paced world, Instant Personal Loan is available for individuals who need financial assistance right away. From application submission to disbursal and beyond, this process ensures that borrowers can access funds promptly and conveniently.
Also Read: Getting a Personal Loan without an ITR
It is crucial for borrowers to understand the terms and conditions of their loans thoroughly and to use the funds responsibly to avoid financial strain in the future. Whether it's for an emergency or a planned expense, the personal loan disbursement process offers a reliable avenue for financial assistance when needed most.
FAQs
How to apply for an Instant Personal Loan?
To be eligible for instant personal loan, you need an existing relationship with the lender, such as a previous loan or a savings/current account. You should also be a pre-approved customer.
What advantages come with obtaining an Instant Personal Loan within the same day?
The primary advantage is the ability to use it for pressing needs like unexpected medical bills. Additionally, it requires low documentation and offers a flexible tenure.
Is it possible to receive an Instant Personal Loan on the same day you apply for it?
Indeed, unlike the typical Personal Loan that may take few days, an Instant Personal Loan disbursement time is much lesser and can be availed on the very day of application. However, it is available only to select customers.
Can I cancel my loan after the fund transfer?
No, you cannot cancel the Personal Loan once the money is credited to your account. However, you can cancel the loan application before disbursement or even after approval, typically with a bank's customer care assistance.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
