With the term ‘cashless’ taking center stage in India’s financial circles since December’s Demonetization, the spillover effect can be seen on personal finance in the form of paperless personal loans.
But, what is a paperless personal loan? A paperless personal loan is a digital financial transaction in which one party (lender) agrees to provide or give a personal loan to another party (borrower). Such transactions can happen via a digital lending platform.
The principal personal loan amount, tenure and EMIs are all set during the approval process. The approval process does not involve any middlemen like in case of traditional bank loans. The communication between the lender and borrower happens completely online makin it a ‘paperless’ process. A digital lending platform is set up in such a way that the borrower’s personal, financial information and social authorization are evaluated by the platform and based on that, the credit worthiness of the borrower is calculated. The lender then decides if the loan is to be approved or not. No bank statement photocopies, no attested documents, no reference forms, no heaps of application forms needed. With no time wasted in documentation, this mode of personal loan disbursement is faster and quicker than traditional bank solutions.
It is not just about saving paper, the reduction in human intervention allows digital lending loan processing to become more streamlined and less human error-prone. With the number of documents down to just 1 or 2, the borrower saves the time s/he would spend in accumulating multiple documents and attestations that would be needed at traditional lending solutions like banks. The emergence of technology helps digital lending platforms improve on traditional banking pain points such as delay in loan approval, time taken in disbursement etc.
With such benefits, the number of borrowers opting for online paperless personal loans is bound to increase. With digitization enabling Indians to make use of online payment modes, the option to avail a personal loan online does not seem farfetched.
Although paperless loan process saves time, borrowers must still be focused in ensuring timely payments of EMI. The ease of availing a personal loan through digital lending platforms should not lead you- the borrower to a false sense of security. You need to build a positive credit history with the platform so that you can easily avail another loan in the future. Ensure you have a budget or emergency fund in place to avoid defaults.
How does it work?
In order to avail a loan from a digital lending platform, you as a borrower will first need to fit the eligibility criteria. Being a salaried professional from India and being above the age of 18 years.
To apply for the loan, go to the digital lending platform website and fill in your details throughout the following sections:
- Get Started Page – Select personal loan and input the loan amount with the desired tenure
- Registration page – Add your contact number, personal email ID and corporate email ID
- Social Authorization – Connect to your Facebook, Google+ and LinkedIn profiles
- Profile Page – Fill in your name, gender, father’s name, no of dependents and PAN
- Address Page – Choose your type of residence and mention your street address, city, state and pin code.
- Job Profile – Mention your current designation, total work experience, company name, highest qualification, last institution attended and monthly salary.
- Financials page – Upload your latest 6 months bank statement either from your computer, GMail account or netbanking account directly.
- Auto Debit Page – Provide your bank name, account number and IFSC code so that you can provide the platform permission to auto debit the EMI amount from your account every month. This will easily prevent any defaults.
- Hassle free
Paperless personal loan process is hassle free because there is no need for hefty paperwork or running from bank to bank, filling form after form. You can apply for the personal loan from the confines of your home and get the loan approved with only few clicks.
- Less time consuming
As the whole process from approval to disbursement is online, you avoid the time and fuel wasted in visiting the bank repeatedly to submit documents and forms manually. With no middlemen, the loan is approved in the shortest possible time.
- Keeps your information safe
With the digital lending platform being SSL (Secure Socket Layer) certified, the technology ensures that all the personal and financial information you submit over the platform remains private and protected. You also don’t have to worry about the physical storage of approved documents or attested photocopies.