In the last few years, the financial sector in India has witnessed a significant transformation, from the launch of the Indigenous Payment Gateway RuPay, Unified Payment Interface aka UPI, establishment of new Banks and NBFC to help people make their financial needs easy.
Similarly, the rapid growth of small credit loan app or personal loan apps has made it easy to get instant money while you need it.
These apps have emerged as a convenient and accessible way for individuals to secure financial assistance quickly, without the hassles associated with traditional banking processes.
In this article you will find important information about personal loan apps in India, exploring their benefits, popularity, features, and considerations.
Read – Fake Personal Loan Apps List – Banned By RBI
The Rise of Small Credit Loan App in India
Gone are the days when obtaining a personal loan involved lengthy paperwork, time-consuming verifications, and weeks of waiting.
With the advent of personal loan apps, the process has become streamlined, efficient, and user-friendly.
These apps leverage technology and data analysis to offer instant loan approvals, enabling borrowers to receive funds directly into their bank accounts within hours, or even minutes, of applying.
Benefits of Small Credit Loan App
Instant Access to Funds: Personal loan apps provide borrowers with quick access to funds, making them ideal for emergencies or unforeseen expenses.
Minimal Documentation: Unlike traditional lenders, personal loan apps require minimal documentation. Basic identity, income, and address proofs are typically sufficient.
Convenience: The ability to apply for a loan from the comfort of one’s home using a smartphone makes personal loan apps incredibly convenient.
Flexibility: These apps offer flexible repayment tenures, allowing borrowers to choose a plan that suits their financial circumstances.
No Collateral: Most personal loan apps provide unsecured loans, eliminating the need for collateral and reducing the risk for borrowers.
Credit Score Inclusion: Personal loan apps often consider alternative data points, enabling individuals with thin or no credit histories to access loans based on their digital footprints.
Calculate Your EMI – Easy Loan EMI Calculator
Popular Personal Loan Apps in India
Several personal loan apps have gained prominence in the Indian market, catering to a diverse range of borrowers. Some of the well-known names include:
PaySense: Known for its minimal documentation and affordable EMIs, PaySense offers loans ranging from Rs. 5,000 to Rs. 5 lakhs with repayment tenures of 3 to 60 months.
IndusInd Bank: It’s a Popular Private Sector Bank in India. But we consider it because, with competitive interest rates and flexible repayment terms, IndusInd Bank’s personal loan app offers loans between Rs. 30,000 and Rs. 5 lakhs.
MoneyTap: MoneyTap specializes in instant personal loans, providing borrowers with access to funds up to Rs. 5 lakhs. Its unique line of credit model enables borrowers to withdraw funds as needed.
Bajaj Finserv: Offering a range of personal loan variants, Bajaj Finserv caters to diverse financial needs. Its quick processing and transparent fee structure make it a popular choice.
Nira: Nira focuses on providing loans to individuals with limited credit history, making it an inclusive option for borrowers. It offers loans up to Rs. 1 lakh with repayment tenures between 3 and 24 months.
Important Things To Remember for Borrowers (Personal Loan Apps)
While personal loan apps offer convenience, borrowers must exercise caution and consider the following factors:
Interest Rates: Interest rates can vary significantly among different apps. Comparing rates and opting for the lowest one can save borrowers money over the loan tenure.
Fees and Charges: Personal loan apps may impose processing fees, late payment fees, and other charges. Borrowers should be aware of these costs before applying.
Credibility: Choosing a reputable and regulated personal loan app is crucial to ensure a secure borrowing experience.
Loan Amount and Tenure: Borrowers should assess their financial needs and repayment capabilities before finalizing the loan amount and tenure.
Credit Score Impact: While personal loan apps may provide quick access to funds, borrowers should be mindful of their repayment capabilities to avoid damaging their credit scores.
Read – Best Banks In India
Best Small Credit Loan App / Personal Loan Apps 2024
| Personal Loan App | Interest Rate | Loan Amount (INR) | Repayment Tenure | Disbursal Time |
|---|---|---|---|---|
| PaySense | 1.4-2.3% per month | 5,000 – 5 Lakhs | 3-60 months | 1-2 days |
| IndusInd Bank | 11-30% per annum | 30,000 – 5 Lakhs | 12-60 months | 1-2 days |
| Aditya Birla Finance Limited | 13-28% per annum | 1 – 50 Lakhs | 1-7 years | Up to 48 hrs |
| Tata Capital | 11-28% per annum | 40,000 – 35 Lakhs | 6-84 months | 1-2 days |
| Moneyview | 16-22% per annum | 5,000 – 5 Lakhs | 3-60 months | 1-2 days |
| Bajaj Finserv | 11-35% per annum | 1 – 40 Lakhs | 6-96 months | Up to 48 hrs |
| KreditBee | 15-30% per annum | 10,000 – 4 Lakhs | 3-24 months | 1-2 days |
| mPokket | 17.5-30% per annum | 500 – 30,000 | 3 months | 1-2 days |
| Fibe | 19-36% per annum | 5,000 – 5 Lakhs | 3-24 months | Upto 48 Hrs |
Home Credit |
24-34% per annum | 10,000 – 5 Lakhs | 6-48 months | Within 1 day |
| Lazypay | 18-34% per annum | 3,000 – 5 Lakhs | 3-24 months | Within 1 day |
| Buddy Loan | Starting at 12% per annum | 10,000 – 15 Lakhs | 12 months – 5 years | 1-2 days |
| LoanFront | 12-36% per annum | 1,500 – 2 Lakhs | 62-160 days | 15 minutes |
| SmartCoin | 20-36% per annum | 1,000 – 2 Lakhs | 91-120 days | 1-2 days |
| Finnable | Starting at 16% per annum | 50,000 – 10 Lakhs | 6-60 months | 6 hours |
| Nira | 24-36% per annum | 5,000 – 1 Lakh | 3-24 months | 24 hours |
| RapidRupee | 12-36% per annum | 1,000 – 60,000 | 3-12 months | 30 minutes |
| Truebalance | 60-154.8% per annum | 1,000 – 1 Lakh | 62 days – 6 months | Within 1 day |
| Mobicred | 12-30% per annum | 8,000 – 1 Lakh | 90-365 days | 24 hours |
| MoneyTap | 13-18% per annum | 3,000 – 5 Lakhs | 2-36 months | Few minutes |
| Kissht | 14-28% per annum | 10,000 – 1 Lakh | 3-24 months | 10-15 minutes |
| IndiaLends | 10.25-25% per annum | 10,000 – 50 Lakhs | 6-60 months | 1-2 days |
| Navi | 9.9-45% per annum | Rs. 10,000 – 20 Lakhs | 3-72 months | 1 hour |
| Zype | 9.5-34% per annum | Rs. 10,000 – 5 Lakhs | 12-72 months | Within minutes |
| Pocketly | 24-36% per annum | Rs. 500 – 50000 | 1-4 Months | Few Minutes |
Documents required for Personal Loan
Different lenders might require different documents, but some of the most common ones are-
Identity Proof (Voter ID Card, Passport, Driving license, Aadhar Card, PAN Card etc.)
Address Proof (Utility bills, Rental Agreement, Bank Statement etc.)
Income Proof (Salary slip, Tax Return, Business Documents etc.)
Credit score or Report
Proof of Employment
Bank Statement for the past 3 months
Eligibility Criteria for Personal Loan Apps
- You must be an Indian citizen.
- You must be in the age group of 18-65 years.
- The Applicant must have a minimum monthly income of INR 15,000.
- You must have a permanent residential address in India.
- The Applicant must be employed or self-employed with a steady income.
- Applicant must have a minimum credit score of 650.
How to apply for a loan on a small credit loan app
First, you should download the personal loan app.
Create an account on the app by providing your basic information like name, phone number, email address etc.
After this, you’ll have to provide some relevant details about your employment, income, and credit history.
After providing all the information, you can apply for the loan. You can choose the loan amount and repayment tenure.
Once you’re done with this, the lender will review your application and decide about it.
Once your loan is approved, the amount you’ve applied for will be deposited in your bank account within 24-48 hours to a few days, depending on your chosen lender.
What criteria should I consider when choosing a personal loan app?
The foremost thing to consider is the interest rates being charged by the lender. The lower the interest rate, the lesser interest you pay over the loan’s lifecycle.
Check the Repayment period the lender has and decide if you’re planning to return the loan within a shorter period or if you’ll need a larger time frame to repay the loan and then choose accordingly.
Some personal loan apps charge application fees, processing fees, late payment fees, and foreclosure fees. Take all this into consideration while deciding.
Check the minimum and maximum loan amounts provided by various loan apps and decide which one will fulfil your requirements and whether you can return the amount.
Always check the lender’s reputation, reliability, and trustworthiness before choosing.
Also check customer support of the personal loan app and its effectiveness because if you face any problem regarding your loan, customer service will help you out in this matter.
What happens if you miss a repayment
A late payment fee will be charged, which might vary from lender to lender.
Your credit score will be affected by this, and you’ll have a drop in your credit score.
If you continue to miss your payments, the lender may take legal action against you.
If you pledged any collateral to secure the loan, your lender may repossess the collateral.
Tips and Warning While using a small credit loan app
Compare different lenders before choosing anyone.
Read the terms and conditions carefully before applying for the loan.
Prepare the required information and documents before applying for the loan.
Don’t pick and apply on the first app you see. Check various apps to find the best personal loan app for you.
Have clarity about how much loan you want, for what purpose you plan to spend, and how much time you’ll require to return.
Some personal loan apps require you to have a good credit score, so maintain a good credit score.
Personal loan apps are a quick and easy way to get money but understand the associated risks also.
Beware of the high interest rates charged by some personal apps. So, check it well.
Be sure to understand all terms and conditions. Know if there are any hidden charges.
Some personal loan apps engage in predatory lending, so beware of those.
A personal loan will affect your credit score, so be thoughtful of all this.
Applying Loan From Personal Loan Apps In India
Personal loan apps can be a convenient way to get quick and easy access to money but make sure you have done thorough research about the lender, interest rates charged, repayment tenure, and terms & conditions.
And borrow as much as you can repay on time. It can help improve your credit score also.
Personal loan apps have revolutionized the lending landscape in India by offering a fast, accessible, and convenient way for individuals to secure funds.
Their instant approvals, minimal documentation requirements, and flexible repayment options have made them immensely popular among diverse sections of the population.
However, borrowers should approach personal loan apps prudently, considering interest rates, fees, and their own financial circumstances to make informed borrowing decisions.
As these apps continue to evolve and innovate, they hold the potential to empower individuals to navigate their financial challenges more effectively.
Calculate Your EMI – Easy Loan EMI Calculator
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FAQ
1. What are personal loan apps?
Personal loan apps are mobile applications that provide individuals with quick and convenient access to personal loans.
These apps allow users to apply for loans digitally, without the need for extensive paperwork and physical visits to banks or financial institutions.
2. How do personal loan apps work?
Personal loan apps typically follow a simple process. Users need to download the app, create an account, provide necessary documents and information, select the loan amount and repayment tenure, and submit their application.
The app’s algorithm then evaluates the application and determines the user’s eligibility. If approved, the loan amount is disbursed directly to the user’s bank account within a specified time frame.
3. What documents are generally required to apply for a personal loan through an app?
The documents required can vary between apps, but common documents include:
Identity Proof (Aadhar card, PAN card, passport, etc.)
Address Proof (utility bills, rental agreement, etc.)
Income Proof (salary slips, bank statements, tax returns)
Employment Proof
Credit Score or Report
4. What are the eligibility criteria for applying for a loan through a small credit loan app?
While eligibility criteria can vary, common requirements include:
Indian citizenship
Age between 18-65 years
Minimum monthly income (usually around INR 15,000)
Permanent residential address in India
Steady employment or self-employment
Minimum credit score (usually 650 or above)
5. How do I apply for a loan using a personal loan app?
The application process generally involves these steps:
Download the app from the app store.
Create an account and provide basic details.
Complete the application form by submitting the required documents and information.
Choose the loan amount and repayment tenure.
Wait for the app’s approval process to evaluate your application.
If approved, the loan amount is transferred to your bank account within the specified time frame.
6. What factors should I consider when choosing a personal loan app?
Important factors to consider include:
Interest rates: Lower rates are preferable for reduced interest payments.
Repayment period: Choose a tenure that suits your financial situation.
Additional fees: Check for processing, late payment, and foreclosure fees.
Loan amounts: Ensure the app offers the loan amount you need.
Lender reputation: Research the app’s reliability and customer reviews.
Customer support: Good customer service can be helpful in case of issues.
7. What happens if I miss a repayment?
If you miss a repayment:
You may be charged a late payment fee.
Your credit score could be negatively affected.
The lender may take legal action or initiate recovery processes.
If you’ve provided collateral, it may be seized by the lender.
8. What tips should I keep in mind while using personal loan apps?
Compare different lenders before choosing.
Read the terms and conditions thoroughly.
Prepare the required documents before applying.
Don’t rush; explore various apps for the best fit.
Maintain a good credit score for eligibility.
Understand all associated risks and costs.
9. Are personal loan apps safe to use?
Personal loan apps from reputable and regulated lenders are generally safe to use.
However, be cautious of apps with unusually high interest rates or inadequate security measures.
Always read reviews, check for official licenses, and ensure the app is secure before sharing personal information.
10. How can you improve your credit score?
To improve your credit score:
Make timely payments on all existing loans and bills.
Maintain a low credit utilization ratio.
Keep older credit accounts open and active.
Avoid applying for multiple loans within a short period.
Regularly check your credit report for errors and rectify them.
Important Note:– Please note that the information provided is subject to change, and it’s advisable to visit the respective ‘small credit loan app’ official websites for the most up-to-date and accurate details before making any borrowing decisions.
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