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Personal Loan

5 Ideal Features To Look For In A Personal Loan Scheme

You may find yourself in a situation where you need extra cash to tide you over. You may need to start a business, make a large purchase, or you may need to consolidate some debts. Whatever your reasons for needing a personal loan scheme, you should look for one that suits your needs and gives you the best deal. However, with so many schemes on offer in the market, knowing which is perfect for you can take time. Let’s have a look at five crucial aspects to look for in a personal loan scheme. Keep reading to learn more! [B-01] Low-interest rates Many personal loan schemes are available in the market, each offering different features. One important feature to look for is the interest rate. Interest rates can impact the overall cost of the loan. They can make a big difference in whether or not the loan is affordable. For this reason, it is always worth looking for a personal loan with a low-interest rate. A low-interest rate personal loan scheme is always ideal, as it means: You will have to pay less interest over the life of the loan. Can save you significant money in the long run. Make repaying the loan more manageable. There are many personal loan schemes on the market. So be sure to shop around and compare interest rates before making a decision. Flexible Repayment Terms A key feature of personal loans is the ability to tailor the loan to the borrower’s specific needs and budget. One way to do this is to offer flexible repayment terms. A personal loan scheme with flexible repayment terms is an ideal feature to look for if you have difficulty making fixed monthly payments. With a flexible repayment schedule, you can: Choose how long you want to repay the loan. Postpone your repayments until you are in a better financial situation. Make smaller payments in the form of EMIs, which can help manage your cash flow. Make extra repayments on your loan without incurring any penalties. This can help you pay off your loan sooner and save on interest costs. Stay current on your loan schedule to avoid default. Repay the full amount at the end of the term without any financial issues. A personal loan scheme with flexible repayment terms may offer a lower interest rate than a traditional loan, making it more affordable for borrowers. No Hidden Fees or Charges A scheme with no hidden fees is one of the most crucial features to look for when applying for a personal loan. This is because hidden fees or charges can frequently add a significant amount to the overall cost of the loan. Thereby making repayment extremely difficult. A no-fee, no-charge personal loan scheme allows you to learn the true cost of your loan better. This can help you make better loan decisions and avoid surprises down the road. Furthermore, it can make the loan process more transparent and help build trust between you and the lender. Here are five hidden charges to watch for with personal loans: Origination Fees: This is a fee charged by the lender in return for originating the loan. Depending on the lender, personal loan origination fees typically range from 1% to 10%. Loan Processing Fee: The lender charges a fee for processing your loan. It is typically a percentage of the loan amount that varies depending on the loan provider and can range from 0% to 8%. Prepayment Penalty: Some lenders charge a penalty if you pay off your loan early. This is typically a percentage of the outstanding loan balance and can range up to 5%. Late Payment Fee: This is a fee for defaulting the payment of an EMI(equated monthly instalment) of your loan. The penalty is typically between 1% and 2% of the EMI. Duplicate Documentation Fee: This is a fee charged for reissuing loan-related documents. These can include statements, credit reports, NOCs, etc. This fee generally ranges between Rs. 50 and Rs.500. Speedy Application Process & Approval Times A personal loan can be a lifesaver during tough times. But the application process and approval times can be frustrating, when if you need the money urgently. That’s why a speedy application process and approval times are ideal when looking for a personal loan scheme. This is because it shortens the time required to complete the process and receive funds. This way, you will receive the funds you need quickly and without delays. However, getting your loan application approved quickly, on the other hand, is only sometimes a piece of cake. Here are a few helpful hints to remember for getting fast loan approvals: First and foremost, maintain a good credit score. Check the lender’s eligibility requirements in advance to ensure that you meet all of the criteria. Make sure to gather all of the necessary papers and details on hand before you start the process. Complete the application as accurately and truthfully as possible. And lastly, be prepared to explain why you are requesting the loan and how you plan to use the funds. Excellent Customer Service Customer service is one of the most vital factors to consider when looking for a personal loan scheme. This is because it can make a big difference in your loan experience. With excellent customer service, you can expect to be treated well throughout the entire loan process. From the initial application to the final repayment, you’ll receive quality service that meets your needs. This means having access to an informed customer service team. This team can answer your questions and help you navigate the loan process. So, make sure to ask about customer service when considering a personal loan scheme. In addition, try to find a lender with a good reputation for assistance to make your loan experience as smooth and stress-free as possible. [B-02] Conclusion Nowadays numerous personal loan schemes are available in the market today; however, not all are created equally. So, when looking for a personal loan scheme, remember these five key features to get the best value. Furthermore, Piramal Finance’s personal loan scheme offers all of these features and more, making it an ideal choice for you. To learn more, visit the Piramal Finance website today.
08-11-2023
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Guide

Which banks are best for FD?

Although there are multiple investment options like mutual funds, government bonds, and many others, they all come with a few inherent risks. As a result, most Indians still prefer to invest in fixed deposit schemes that give them decent returns without any risk of losing money. However, it would be best if you worked with the best banks for FD to get the best returns. In this article, we will show you a list of Indian banks that offers the best FD schemes in this country. Let’s dive in. [B-01] A Glance at the Banks with the Best Fixed Deposit Rates One of the most critical factors in determining the best bank for FD is to look at the bank’s FD interest rates. Here’s a table of banks and their current interest rates for both regular people and senior citizens: Bank NameFD Interest RatesSenior Citizen FD Interest RatesTenure of FD AccountAXIS Bank3.50% – 6.10% per annum3.50% – 6.85% per annum7 days – 10 yearsBank of Baroda3% – 5.65% per annum3.50% – 6.65% per annum7 days – 10 yearsBandhan Bank3% – 7.50% per annum3.75% – 8% per annum7 days – 10 yearsHDFC Bank3% – 5.50% per annum3.50% – 6.25% per annum33 – 99 monthsCanara Bank3.25% – 7% per annum3.25% – 7.50% per annum15 days – 10 yearsICICI Bank3% – 6% per annum3.50% – 6.60% per annum7 days – 10 yearsPunjab National Bank3% – 5.75% per annum3.50% – 6.25% per annum1 – 10 yearsKotak Mahindra Bank2.50% – 5.25% per annum3% – 5.75% per annum7 days – 10 yearsUnion Bank3% – 6.70% per annum3.50% – 7.20% per annum7 days – 10 yearsState Bank of India3% – 5.85% per annum3.50% – 6.65% per annum7 days – 10 years Which are the Best Banks to Open an FD? Now, let’s look at the five best banks for FD and what makes them an excellent choice for starting a fixed deposit with them. AXIS Bank AXIS bank is one of the most popular Indian banking and financial service company, and its headquarter is located in the city of Mumbai, Maharashtra. It holds a large share of the Indian banking sector and is the third-largest private bank in India. AXIS bank offers multiple fixed deposit schemes with different tenure and interest rates. This bank provides its customers with one of the highest fixed deposit interest rates, allowing them to earn more money on their deposited amount. Each fixed deposit scheme requires you to deposit a minimum amount of money indicated in their catalogue and website. And you won’t be able to withdraw your money until the fixed deposit account reaches maturity. Still, thanks to the generous interest rates and secure investment options, AXIS bank is known as one of the best banks for FD in India. Bank of Baroda Bank of Baroda is a public-sector bank, and most of its shares are owned by the government of India. This bank offers multiple financial services, including Treasury, Retail banking, Corporate banking, and more. Its banking services offer savings, current, fixed deposit accounts, and a few more to its regular and business customers. Bank of Baroda allows you to open a fixed deposit account with minimal effort and doesn’t require much paperwork. Senior citizens can get up to a 6.65% per annum interest rate on their fixed deposit, depending on the FD scheme. Its hassle-free and straightforward banking services make it one of the best banks for FD in this country. Bandhan Bank India’s 8th largest bank by market capitalization, Bandhan, is a public sector bank that formally commenced its banking operations in 2015. Apart from public banking, this bank also offers many other financial services, including, Corporate banking, Treasury, and retail banking. Bandhan Bank has many fixed deposit schemes that fulfil anyone’s FD investment needs. Its Standard Fixed Deposit scheme allows you to open an FD with an amount as low as Rs. 1,000. Meanwhile, it also offers the Premium Fixed Deposit scheme with a minimum deposit requirement of Rs. 2 crores. Most of its fixed deposits have monthly or quarterly interest payouts, allowing you to make partial withdrawals. Bandhan bank also enables you to get loans against your fixed deposit. All these features make it one of the best banks for FD. Canara Bank Canara bank offers tax saver FD schemes that allow you to receive tax benefits on your fixed deposit. However, they do come with a minimum lock-in period of 5 years. You can’t touch the money during these five years to receive the tax benefits. Canara bank offers excellent interest rates on its fixed deposit schemes, which can go up to 7.50% per year, depending on your chosen scheme. You will receive an interest deposit on your FD once every month or quarter. Undoubtedly, Canara bank is one of India’s best banks for FD investments. HDFC Bank HDFC bank allows you to open a fixed deposit account with an amount as low as Rs. 100, while the maximum deposit amount has no limit. They also offer tax-saving FD schemes with up to 5.50% per year interest rates for regular people and up to 6.25% per year interest rates. These FDs come with a 5-year lock-in period, and the bank deposits the interest earned twice yearly. If you’re looking for the best banks for tax-saver FD, HDFC bank is a fine choice. [B-02] Conclusion If you want a risk-free and secure investment option that offers decent returns, the fixed deposit is the way to go. You can open a fixed deposit account with any banking institution in India. To help you get the best FD deal possible, we have shared a list of banks with great fixed deposit schemes with high-interest rates and several other features like tax benefits. Evaluate your options carefully to find the best bank for FD. Are you worried about your immediate personal finance after depositing considerable money in FD? Check out the personal loan offers from Piramal Finance today!
08-11-2023
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Tax Savings

LIC Jeevan Umang Policy: Does it Offer any Tax Benefit?

LIC (Life Insurance Corporation) is a public company. The main office is in Mumbai. It was established in 1956. It is now India’s largest provider of life insurance. There are 25 crore subscribers to the LIC family. A LIC plan is always a benefit for the family. It’s a good long-term investment. LIC Jeevan Umang Policy is one of the various plans started by LIC. It was launched on February 1, 2020. The goal is to give security and money to your loved ones. Customers can also use loan facilities with this plan. It gives coverage for the insured person’s whole life. Even a maximum of 100 years. A final amount is given to the policyholder’s heir or chosen person. This is if they pass away during the term of the plan. [B-01] Characteristics Of Lic Jeevan Umang Policy The following are some of LIC Jeevan Umang Policy defining elements- The amount guaranteed begins at Rs. 2 lakhs. There is no upper limit. Policyholders are free to select any amount. It should be assured above the minimum. LIC offers a variety of high-quality payment alternatives. Policyholders may select any period. They do so by looking at their needs. The payment time can be 15 to 30 years. It depends on the person getting insurance. The term is determined by deducting the policyholder’s age from 100. LIC Jeevan Umang’s policy age of maturity is 100 years. The policy term will be 75 years if the policyholder takes the plan at the age of 25. Policyholders of LIC may deposit insurance contracts on terms. It can be monthly, quarterly, mid, or annual. Policyholders can only use the National Automated Clearing House (NACH) service to make monthly payments. The plan is deemed null if premiums are paid for less than three years. It will be void if the policyholder fails to pay the payment for the coming years. There is a 15-day free trial duration for LIC’s Jeevan Umang Policy. Policyholders may examine the policies and terms of the insurance throughout that time. Who Is Eligible For Lic Jeevan Umang Policy? The eligibility criteria for the policy are listed here: – The age requirement for entrance is 90 days. The entry age cap is 55 years old. The age of the policyholder at the end must be at least 30. A policyholder’s age at the end of the paying period may not exceed 70. The threat will start right away for policyholders older than 8 years. Risk will start for policyholders under the age of 8. This is after two years of uninterrupted insurance coverage. All The Benefits Of Lic Jeevan Umang Policy Death aid: If the policyholder passes away before the policy’s maturity date, the nominee will be given a pay-out based on the conditions listed below: Loss of life before the risk begins: The entire premiums will be paid. It excludes interest and any fees. It will be used to find the payout amount. The payment will include any extra fees assessed. It is for add-on riders or any underwriting judgement. After the risk has started. Some amounts will be paid at maturity if death strikes. Those are: 10 times the yearly premium. The basic sum is assured. The sum assured. The sum must be at least 105% of the total premiums paid. Life aid: Valid until the date of maturity. Even until the insurer passes away, an annual survival benefit equal to 8% will be paid to the policyholder. Valid only if the insured person lives to the conclusion of the paying term. Must pay all premiums to make the policy effective. Benefit at Maturity: If the policyholder lives to the date of maturity. Then a payout is made to him or her that consists of the basic sum assured. Also, bonuses and final extra bonuses. Loans are only available to insurers. For whom plans have developed a particular amount. This is during the policy period. Such loans are subject to interest rates and are periodically reviewed. A loan may be available if the policy premium has been paid for at least three years. The Effects Of LIC Jeevan Umang On Taxes: Tax Benefit The IT Department imposes some mandatory taxes. In accordance with the applicable tax legislation. The marginal rates can change depending on factors. The policyholder should pay all relevant taxes. It is fully on the basic policy and rider premiums. Tax relief is there for the paying members and holds the coverage. This is under Section 80C of the Income Tax Act of 1961. Policyholders can also claim tax advantages on the policy’s proceeds. How Can One Claim It? If you want to Claim this policy as the nominee or recipient, first notify the insurer. The policyholder must provide the company with a discharge form. Also, the needed information to take maturity benefits. The list of records that must be given in support of a death claim is provided below: claim form submitted, claim form submitted, medical records (if needed) Policing FIR (if needed) certificate of death report on the autopsy the claimant’s ID and proof of age. What Are Some Of The Exceptions Here There are two primary exceptions here- If the insurer dies by suicide before the policy has been in effect. The coverage will be void if it is 12 months since the risk began. All claims in these situations will be denied, except 80% of the premiums paid. A cash payout equal to or greater than 80% of the fees charged. This is only within a year following the date of reactivation. [B-02] Final Takeaway LIC Jeevan Umang Policy is a popular insurance plan. By choosing this policy, you can gain protection as well as build up a savings fund for the future. Other useful services provided by LIC Jeevan Umang Policy include loans and annual income benefits. Getting this insurance coverage has no negatives. Try using LIC Jeevan Umang Calculator to check if it is in your price range. For more details on insurance policies and their benefits, visit Piramal Finance. They have many articles and blogs to help you learn more about this topic.
08-11-2023
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Personal Loan

Features of Loans for Chartered Accountants in India

CAs may either join an existing firm or start their practice. Due to the rising number of experts in the chartered accountant field, several banks and banking firms have created unique loans for CAs alone. A CA’s job is to give advice, audit accounts, and generate reliable data and financial reports for its users. If the person intends to reach economies of scale, there is a demand for more working capital to expand the office, bring proper equipment and furnishings, and so on. These chartered accountant loans are intended to be issued with as little paperwork and processing as possible. Lending occurs on a digital platform, allowing for rapid loan payout. [B-01] Features of Chartered Accountants Loans The following are the primary features of loans made available to chartered accountants: Loan Process That Is Quick and Painless The whole lending process has been digitised and eased. Filling out a simple request form should take no more than 15 mins. You may also supply papers digitally. Personnel visit the client to verify the validity of the papers. Loan Without Collateral The profession of a chartered accountant is one of service; the underlying company cannot be pledged as collateral. Thus, the loans given here depend solely on your academic qualifications and credit score. These are unsecured loans. Yet, as contrasted to personal loans, they are handled faster. Also, interest rates are lower. Paperwork Is Minimal Although this is an unsecured loan, the paperwork needed is not extensive. You may submit the papers online, and banks and banking firms offer door-to-door checking. Flexible Repayment Choices You might set a proper payback time depending on the kind of loan obtained. These loans often have a term of one to five years. However, they adhere to the EMI (Equated Monthly Installment) payment plan. Most banking firms and banks levy a processing fee of roughly 2%; however, others may charge a modest fee for their online comfort. Most banking firms offer loans up to Rs. 35 Lakh or Rs. 50 Lakh. Banks have reduced the process to the point that the loan may be issued within 24 hours. The loan might also be in the form of a fixed-term overdraft facility. In such a circumstance, the borrower is only obligated to pay interest on the monies removed from this account and only for the withdrawal time. CA Loan Qualification Although various lenders have varying eligibility needs, below is a summary of basic CA loan eligibility needs for chartered accountants: After graduation, you must have a degree of practice and at least four years of work expertise. At the time of loan maturity, you must be at least 25 years old and no more than 65 years old. You must earn a minimum of Rs. 1 lakh each year. Your company must have made a profit in the previous two years. It would be best if you had a high CIBIL score. Chartered Accountants’ Loan Papers Before a loan for chartered accountants may be approved, you must provide certain papers. The following is a list of the papers that are needed. Person Identity Proof- PAN Card of the Company/Firm KYC papers include an Aadhaar card, a voter ID card, a passport, a driving licence, and a PAN card. Aadhaar Card/Voters ID Card/Passport/Driving License as Proof of Residence Last six months’ bank records The most recent ITR, cash flows, and profit and loss statement for the last two years, as verified by a CA. ITR / trade licence as proof of business Other papers that the lender may request Options for Chartered Accountants Loans Aside from the one described above, a slew of additional items are available, particularly for experts in this field. These customised items are classified as: Chartered Accountant Personal Loan These chartered accountant loans are related to the business loan offered, but their aim may not be to start a firm, and the interest rate may be much higher. Such loans are offered digitally, with reduced paperwork and sanctioning processes. Loan terms might vary from one to five years. Pre-approved loans are given to you with good credit and a lengthy history with the banking firm. These loans may also be expanded as Flexi-loans, with money made accessible as an overdraft facility. The loan sum might vary between Rs. 35 lakh and Rs. 50 lakhs. It varies from bank to bank. The rate of interest on these chartered accountant loans, which are only available to chartered accountants, will be lower than the interest rate on other types of loans. Chartered Accountant Business Loan These unsecured loans are granted based on an applicant’s academic record and creditworthiness. External security or surety are not needed. When contrasted with other business loans, these loans have cheaper interest rates. Chartered Accountants Can Get a Home Loan Chartered accountants are eligible for tailored home loans. The loan amount offered is up to Rs. 2 crores. This limit may differ from one lender to the next in certain cases. Tenure might vary between 10 and 30 years. To save on EMIs, the borrower might move from their current loan to a cheaper house loan. There are also add-on loans available. You may use value-added services like property search and dossier services. Chartered Accountants May Borrow Money Against Their Property These are secured loans intended solely for chartered accountants. They have different interest rates depending on the property that is pledged. Aside from the property pledged, the chartered accountant’s earnings from practice or salary would be viewed. In addition, credit score is vital in all forms of loans. If these factors are met, attractive loan terms may be arranged. [B-02] Conclusion CAs may profit from these chartered accountant loans in a variety of ways. However, to qualify for this loan, you must have prior experience and a professional degree in this industry. The alternative method needs just the bare minimum of documents and basic qualifying criteria, with no more action needed if you meet those standards. You may benefit from extremely cheap interest rates and large loan sums. If you want to know more about loans for chartered accountants, visit Piramal Finance for related blogs and explore their products and services.
08-11-2023
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How To?

How To Calculate Returns of Mutual Fund SIPs Using MS Excel

The full form of a SIP is a systematic investment plan. It helps you invest small amounts regularly at fixed intervals. This makes it very easy for people to invest. Just decide on the right amount from your salary and keep it aside. It is very good for long-term investments. You can decide the time. It could be a week, a month, or a quarter of a year. We can use the mutual fund SIP calculator for complex calculations. [B-01] How to calculate SIP using MS Excel? Before this, let’s understand the term “NAV.” Its full form is “net asset value.” It means the cost of a single unit in a mutual fund. For example, the cost of one pen is 10 rupees. The cost of three pens is 30 rupees. So the cost of a single unit is NAV. It can vary with mutual funds. It is very important to understand NAV before investing. Mutual Fund SIP Calculator The following is the process for calculating SIP returns in MS Excel: Decide on the fixed SIP amount. Decide on the period. Note down the NAV values for that period. Calculate the number of units. Calculate the total amount based on units. Detailed explanation and formula: Take three columns in Excel. In the first one, mention the time intervals. Write NAV values in the second one. Write the decided value of SIP in the third one. Use the following formula to calculate the number of units: Formula: (no. Of units)=Amount/NAV. Add all the units of every month. Note its value. Calculate the total amount using the formula: Formula (Total amount)=Total no. of units × Latest NAV values. The last step is to calculate the profit earned. The formula used to calculate the profit earned is Formula (profit earned)= Maturity amount – Total amount. Now, let’s understand the maturity amount: It simply means “future value.” It is the amount to be received based on the time interval. Your funds are in your hands. You decide to keep or sell them. You can sell them any time you want. However, there are exit criteria linked to the sale of some funds. Some funds cannot be sold before the deadline. You will also get charged under the exit criteria. It’s almost 0.1% of the amount. This is a negligible amount of your profits. You can make decisions related to time. Or according to your comfort. Doing some research before buying and selling is a good option. How to calculate the maturity amount or future value (in MS Excel): We can use formulas in Excel to calculate the maturity amount. This is a very easy process. For calculations, we don’t have NAV values for the future. It is not possible to have exact NAV values for the future. But we calculate the expected NAV values. This step is needed for further processing. This value is termed “yearly expected returns.” Steps to calculate Open a spreadsheet in MS Excel. Write the number of months in one column. Mention expected yearly returns in the second column. Write the value of NAV for the first month. Keep track of the expected annual returns. Calculate the next month’s NAV value using the yearly expected return. Calculate the current month’s NAV value. The formula to calculate the current month’s NAV value is [(Yearly expected return / 12 × NAV of last month / 100) + NAV value for the previous month] Use the above-given formula in Excel. All the formulas in Excel are written in the formula tab only. It is user-friendly software. Using the above formula, calculate all the NAV values for the remaining months. Calculate all the NAV values for the remaining months using the above formula. The formula to calculate the number of units is: Number of units = Amount / NAV Add units for each month. Note the sum of the units. After getting all the values above, we need to calculate the maturity amount. The formula used to calculate the maturity amount (mutual fund SIP calculator) is: Formula (Maturity Amount) = Total number of units × Latest values of NAV Hence, we get the maturity amount. Now, the profits for the year can be easily calculated. The formula to calculate the profit is:Maturity amount (Future Value) – Total amount which was investedBy following the above steps, we can easily figure out the returns of a mutual fund SIP with MS Excel. Benefits of SIP Little investment: The SIP requires very little investment. It is there for long-term investments. This makes it open for everybody. The user is free to decide the time interval as well. It has a user-friendly interface. People can invest a small amount of their monthly salary. This can benefit them in multiple ways. It can even open new doors for them. This introduces people to a new world of finance. A mutual fund SIP calculator can be very helpful for this. It helps to calculate the correct amount to be invested. Simple to use: Calculating the returns of mutual funds SIP is very simple. There is no need for a financial background. Anyone with basic knowledge of MS Excel can use it to calculate the returns on SIPs. All of the steps for calculating mutual fund SIP returns using MS Excel are detailed above in the blog. Enables Cost Averaging: One of the most important benefits of SIP is that it enables cost averaging. You can buy units based on the NAV value. If the NAV value is high, buy less. If the NAV value is less, buy more. This helps in proper planning. It is also useful because you can make changes. Everything here is in your own hands. Achieving goals: It is very useful for people who have knowledge but don’t have a lump sum to invest. They can invest small amounts at regular intervals. This adds up to a great profit. Good investments can surely help in achieving long-term goals. [B-02] Conclusion In the end, investing is useful. The returns of mutual fund investments can be easily calculated. This is done in MS Excel. It is an easy process. It can motivate the youth to learn, grow, and invest. For more information, visit Piramal Finance.
08-11-2023
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Tips & Advice

Top 10 Facts & Benefits of Recurring Deposits in India

A Recurring Deposit (RD) account has always been popular. It has retained its popularity despite many new-age schemes. It is similar to FD but does not demand a lump sum amount for deposition. As the name suggests, recurring deposit involves depositing money annually for a determined period. Later, people can benefit from the interest earned. It is popular for the convenience with which people can invest. RD is especially preferred by people not ready to face the consequences of being an irregular investor. There are many benefits of RD, and a few are listed below to make a future investor understand its value. [B-01] What makes an RD differ from FD? The recurring deposit has a lot of common features with the fixed deposit. The key difference is that FD involves a huge investment upfront, and the interest will be gained over time. Whereas in RD, the investor has the advantage of initiating the investment with a small amount and can increase the amount by month at their convenience. The interest profit will be high in FD as the money invested is huge. But this edge for FD recognizes the numerous benefits of RD. How to create an RD account? The procedure is the same as the other mutual fund investment options. Reach out to the nearby bank. Fill out a recurring depositing account opening form. Submit the details with an added cheque for the first instalment. Before opening an account, decide the interest rate, the instalment’s tenure, and the amount. Carry all the relevant proof of details requested by the bank. The RD account can also be opened via a post office at one’s convenience. How does RD benefit an investor? As an investor, anyone will try to have control over their money. This is much more possible with recurring deposits than with other high-risk investment policies. First things first, starting the investment with very low money is probable. The initial amount may vary with the choice of bank. This lets people from all financial backgrounds start their investment journey. Since there is low to no loss, it encourages newbie investors who are sceptical about taking the first step. The investor can also determine the investment duration depending on their goal. The assurance in return is what makes this scheme better than other schemes. So, an investor can strategize a plan and achieve their goalkeeping the benefits of RD in mind. What makes the RD stand out? High-Interest value: The recurring deposit has a high investment return value compared to the mutual fund SIPs. This is because SIPs, other mutual funds and stocks are highly prone to risk and market volatility. The interest rate for an RD is fixed at the beginning of the investment; thus, returns cannot fluctuate. Low risk: One of the noticeable benefits of RD is it involves low risk. It is perceived as a safe form of investing money. It is not subjected to any variation in the share or stock market. Flexibility: The amount involved in an RD is flexible to the investor’s convenience. They can increase or decrease the money intended to invest at any specific period, and this will not have any legal or fineable backlash. Easy payment: There is no obligation when it comes to investing in an RD. It does not demand in-person investment nor rules to be followed for how money is transferred. It can be transferred from either a savings or a current account without breaking a sweat. Achievable short-term goals: Recurring deposits are the go-to investment scheme to attain any short-term goal. It is flexible for both long-term and small-term goals, unlike certain mutual funds where the profit earned via interest is visible only after a decade. This crucial benefit of RD is what makes it famous among the common people. Minimal initial investment: The initial investment can go as low as Rs.100 in some banks. This low minimal investment invites a large number of investors across all ages despite a poor financial situation. Similarly, the minimum tenure starts from 6 months to one year. Thus, one need not fret about their future financial situation. Makes saving easy: With all the above-mentioned points, even the worst spendthrift could be persuaded into saving money. Knowing the money is secured yet yielding a profit in the form of an interest rate is a good enough reason to save the money. Online mode of investment: The only difficulty ever faced by the public with RD or any other form of investment for decades is the long-standing queue in every bank. This is now the case with the prevailing digital advancements. Money can be invested anytime, anywhere, using the online facilities of the banks. The wide age range for investors: RD breaks the stereotype posed by other schemes of investing only after a certain age. In recurring deposits, the minimum age goes down to as low as 10. Kids can open an account with the support of parents or guardians. And adults over 18 are free to open a recurring deposit account jointly or on their own. A key benefit of RD is availing of loans: The option to apply for a loan against your RD account makes it an irresistible way of investment. This is possible after an RD account is activated and receives 12 months of active investment. Later, the loan can also be paid in instalments depending on the convenience of the person. This is considered one of the notable benefits of RD. [B-02] Conclusion: Recurring Deposit is one of the most loved forms of investment among the public. Upon reading the above article on the advantages of an RD, one can move forward to initiate their investing journey. It is the low-risk mode for an individual to acquaint themselves with the field of investment before starting high-risk investments.
08-11-2023
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Know More

What Is A Personal Line Of Credit? Pros And Cons

Personal lines of credit (PLOCs) are continuous, unsecured accounts with changing interest rates. A personal line of credit offers quick access to cash for both personal and professional needs. Up to a certain amount, it allows you access to money. A flexible loan from a bank or other finance company is known as a line of credit. A line of credit is a set amount of money that you can access as needed and repay quickly or over a particular length of time. It is similar to a credit card that offers you a set amount of money that you can use when, if, and how you like. The client may raise the credit limit at any time during the life of a personal line of credit facility depending on their credit profile and spending habits. [B-01] What Is The Eligibility? To be eligible for a personal line of credit, one must have a credit score of at least 690 and a good credit history. More important is a proven track record of revenue and job documentation. Your options are limited because many financial organisations that offer personal lines of credit demand that you open a checking account with them and/or submit an application through a local branch. The following needs are crucial for a personal line of credit: Payment background: A track record of on-time payments shows that you are a trustworthy borrower. Credit score: Your credit score, which is decided by credit agencies, is a reflection of your financial standing and ability to repay bills. Financial situation: Your ability to repay debts is shown by your net worth, cash on hand, and debt-to-income ratio, among other financial indicators. How Can One Repay? Repayment Process Because there are so many different repayment plans available, receivers should be aware of the particular conditions of their loans. Repayment methods are available, but they can come with difficult conditions. Below, we’ve listed a few uncommon repayment methods: Draw and payback times: Personal lines of credit may occasionally have distinct pull and payback times. The user may get cash during this draw time. They must pay the money back throughout the repayment term in equal instalments. Bubble pay-outs: A personal line of credit could have a requirement that the entire balance is paid at the end of the term. If balloon payments are employed and the debtor isn’t able to pay the money back the whole amount, refinancing may also be required. Loaners terms: On occasion, banks will provide a collect credit facility, which works exactly like a regular credit source but gives the loaner the option to demand his money back. Pros Of Personal Line Of Credit Why is it used? Let us find out its benefits. The following are the good elements of personal lines of credit: Quick financial access- One has the power to ask for money from a personal line of credit at any time. The loaner decides the access to the borrowing capacity online, through a mobile app, or at a bank branch. Security- Few banks can give the liberty to use PLOC as a protection form on certain accounts. If you regularly give checks or are scared of emptying the finances, this could provide you with security. Lower interest rates- A personal line of credit often offer lower rates of interest. This is very low compared to credit cards. Still, the interest rate seen in PLOC will fluctuate depending on the loaner and the credit history you’ve stated. Greater Options- You can withdraw any amount, up to the size of your credit limit. Cost-Effectiveness- You just have to pay interest on the amount you borrow; it is not charged on the authorised credit limit. Strong Credit Limit- Depending on your credit history and your needs, you may be accepted for a larger credit limit, allowing you the ability to manage your debt however you see fit. The emergency helper-The best option for an emergency is to use a personal credit line, which is available around the clock. When dealing with a medical emergency or any other issue that necessitates financial commitment, this feature proves to be wonderful. Collateral isn’t needed- A PLOC doesn’t need any collateral. Comparatively, the 1home line uses collateral of your house’s value as security. So, if you don’t have a property or vehicle, taking this personal line of credit will be beneficial to you. Cons Of Personal Line Of Credit With every right, there are a few wrongs. Let’s see what are some major cons and negatives of PLOC. The cons are- Higher rates: A HELOC is much more secure as the home will be used as collateral to secure the debt. A PLOC, however, is not deemed secure because it doesn’t ask for collateral. This implies a higher interest range. One cannot deduct the interest paid from the tariff because it is not tax deductible. This raises the price of starting your line of credit. With bad credit history, it can be challenging to qualify because there is no collateral needed for a PLOC. The lender should trust you to give the money back. This means that if your credit history is bad, they won’t be able to provide you with a personal line of credit. Endless Cycle: Because the credit account is revolving, it is simple to keep getting cash out and lose track of repayments. Costs of Closing and Upkeep: Some banks and finance companies may charge a fee to close a credit line, and others may charge a fee to maintain an open credit line. [B-02] Today’s Learning Before using the credit line, make a repayment plan. Make sure you have enough money coming in each month to pay back the loan. The best approach to check your affordability is to use an EMI method to calculate your monthly bills. A personal line of credit can be issued for any amount you need and used regularly, working similarly to a credit card. This method of taking loans has several benefits, including easy access to cash and more reasonable prices than credit cards. If you decide to get a personal line of credit, research platforms like Piramal Finance to get the best conditions and interest rates for your situation.
08-11-2023
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Tax Savings

Can you get tax exemptions on Personal loans?

Personal loans are those loans that you can seek to fulfil your needs. These needs could be buying a house or a car, planning a wedding or vacation, investing in a business and several others. One can obtain a personal loan by reaching out to a nearby bank. But before you proceed with a personal loan, you must learn about every possible personal loan tax benefit available. First, the lender will check the eligibility criteria such as nationality, age, salary, job sector, and job status. Then the lender will proceed to refer the papers like employee ID card, Aadhar or PAN card, salary statement for the past 3 months and bank statement for the past 3 months. The loan amount may vary based on the city in which one resides and the monthly salary. The loan offered by each bank may also differ. These personal loans will tend to have a high-interest rate since they are unsecured. The ease with which you can acquire a personal loan may raise the question of taxation. Since it is not a part of your income, it is exempt from tax filing. There is no defined personal loan tax benefit, but taxes are exempt in most cases. [B-01] What are personal loans? Personal loans are loans taken to meet a person’s necessities or interests. There is no narrow spectrum only when a person is eligible for personal loans. It could be for investing in a business, stocks and shares, meeting marriage expenses, debt consolidation and several other needs. A personal loan is different from credit cards in that a lump sum of money is offered at once. How to get personal loans? Many lenders now offer personal loans online. Here are some of the steps that you can follow to get a personal loan: Initially, check for the eligibility criteria. Determine the monthly instalments Gather the essential documents as demanded by the bank Approach either the bank in person or via online mode. Consult the site or manager for anything one should be aware of before applying for a loan, like the interest rate or if the loan is taxable. Personal loans are not taxable, so keep an eye out for the tax implications. Apply for the loan. Why are personal loans called unsecured loans? They are called unsecured loans. Generally, a loan requires pledging collateral to secure the loan amount. This is not applicable when you seek a personal loan. There is no need for collateral to safeguard a lender if the borrower fails to repay the loan. Hence personal loans are considered unsecured loans. Is a joint personal loan a possibility? Yes. One can apply for a joint personal loan with a partner. This partner holds an equal responsibility to repay the loan as the borrower. Joint individual loan sanctions involve screening the documents of both parties and not just the original borrower. It is important to note that the co-applicant credit score and other features can affect the loan amount available. Are personal loans tax-free? Personal loans are generally tax-free as they are not your income but an obligation. As they will not be added to your income, there is no need to pay any taxes on the same. What are all the features of a personal loan? Here are some of the key aspects of a personal loan that you must be aware of: Comparatively fewer papers are needed to handle the application process. Collaterals are not needed to qualify for a personal loan. Personal loan tax benefits can be availed. There are fewer limits on how the money should be used, making it a flexible loan for the needy. Money can be repaid in any possible manner owing to your needs. You can easily qualify for this loan and it won’t be a time-consuming process. By repaying personal loans on time, you can increase your credit score. Ways to save tax for a personal loan. Personal loans are not related to your income. So they are not taxable as long as the loan is acquired from a credible bank. If not, it should be a part of your tax filing. However, based on how the money is used, the interest paid will be deducted. Personal loans used for the right reasons will be exempted from tax. Medical expenses: A sudden medical emergency is a valid reason to seek a medical loan. Buying or building a home: This is a very common reason for personal loan applications. People trying to build, buy or renovate their homes can apply for personal loans to support their monetary needs. This is a common personal loan tax benefit. Note that the loan money should not be used in real estate or renting a house. Business growth: Money can be borrowed from the bank to initiate a business or to develop an ongoing business. This is another classic scenario of applying for personal loans. Investing in a business increases the liability, thus reducing the overall tax payable for the business. To buy assets: Assets like jewellery, non-residential building property, shares, stocks, and cars are considered a valuable use of money obtained via personal loans. These assets tend to increase in value over time. Thus, one can avail of tax benefits though there are no tax benefits posed for personal loans. [B-02] Conclusion Personal loans are one of the popular loans that are meant for the benefit of persons who are in urgent need of money. So, people should make better use of it to support their needs during urgent times. However, it is to be stressed again that personal loans are non-taxable in general. If you want the best personal loan deals and offers, visit Piramal Finance. They also have many articles and blogs to help with your finance skills.
08-11-2023
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Personal Loan

Everything You Need to Know About Personal Loan Tenures

When you borrow from a lender, you promise to repay the amount over some time. The time you pay off the rent is called your loan tenure. For example, if you take a large home loan, the repayment cycle may run for a decade or two. The borrower can’t pay more than a certain amount every month. Every borrower can pay only a fraction of their income as EMI for a loan. When you take out a personal loan for the long term, you lock yourself into that lender’s financial services for the next several years or decades. However, long tenures can also have many advantages, including smaller EMIs. Thus, tenure is something that you would like to consider carefully before making a decision. Keep reading to learn more about personal loan tenure and the various factors affecting it. [B-01] What is a Personal Loan Tenure? Personal loan tenure is the length of time most lenders require you to repay your loan. In most cases, you must pay back the loan for a certain period, and you can repay it in one of two ways: Fixed rate: The lender sets the interest rate for the loan so that it will remain the same for the entire loan period. In other words, at the end of the loan, you will have to pay back the same amount you borrowed plus interest. Adjustable Rate: This rate varies based on the market rates and is fixed for the first few years, but then it increases yearly by a specific amount. It can benefit people who don’t want to make principal payments on their loans and would like to pay them back over a longer period. However, you may want to pay back the loan after a while, so you will have to pay interest on top of the original amount. How Personal Loan Tenure Work When you take out a personal loan, the lender lends you money and collects interest on your loan. That part is so clear to most. But there is little awareness when it comes to the part where the applicant has to decide on the personal loan tenure. Yes, an applicant has a say in how long the repayment of the loan will run for. However, it also depends on the paying capacity of the applicant. The bank looks at the paying capacity before deciding the tenure of the loan. The formula used for determining tenure is complicated. But it can be said that the lender considers a fraction of your disposable income when working out the tenure. Say, for example, one earns Rs 25,000 per month. In this case, the EMI paying capacity will be limited to the early single digits. It is because the applicant will have other expenses as well. Therefore, how much you earn has a bearing on your loan tenure. Factors Affecting Personal Loan Tenure Here are the four things that have a bearing on personal loan tenure. 1) Amount of loan If the amount you borrowed from the lender is large and your paying capacity is modest, you will have no option but to take a long-term loan. Depending on the amount, it will spread the EMIs or equated monthly instalments of your loan over decades and make repayment easier for you. However, this has certain disadvantages. For example, you will end up paying more interest than if it was a short-term loan. Given that the principal amount will be repaid over a long period, you will continue paying the interest. In such cases, applicants must choose the variable interest rate model to benefit from the decrease in interest rates of loans over a long period. Therefore, you can choose a longer tenure if you have financial constraints and limited repayment bandwidth. But if you have the means to pay relatively quickly, you must take that option. It will save you money and allow you to take a second loan sooner. That way, you can consider making new investments too. 2) Interest rate A fixed-rate loan may sound like a good idea, but it may be inadvisable for most people. It is so because even though interest rates may be high initially, they may eventually decrease. If you choose a fixed-interest model, you will have to continue paying a high-interest rate throughout the tenure of the loan. You will have to pay a lot more money in the form of interest. It will be in addition to the amount that you originally borrowed. On the other hand, a variable loan rate is usually lower at the beginning but may increase over time. In such cases, you will end up paying more money. Therefore, you must look at the interest rate trend. It would help you decide which of these options you want to choose. It can make quite a difference to your repayment plan. 3) Earning As stated briefly, the amount you earn will determine your loan tenure. If your earnings are low, the lender would want you to take a long-term loan. It will eliminate the possibility of default, given the EMIs will be small and easy to pay. If you have a large income, you can also avail of a short-term loan as you have the paying capacity to service your EMIs on time every month. 4) Age You’re more likely to receive a long-term payment option if you’re young. However, if you are nearing retirement, things will be different. The bank would point out that your source of regular income is likely to end with your retirement. With no regular income, paying EMIs can become tricky. Therefore, banks are unwilling to give long-term loans to those nearing retirement and offer them to the young instead. [B-02] Conclusion If you are taking a personal loan, you must consider a short payment tenure. It will ensure that you don’t pay more than necessary as interest. However, these loans are also available with a long-term plan. You can repay them over a long period. The length of the loan will determine how much you will have to pay back. You can either choose to pay it off quickly. Or you can make the tenure long with an adjustable rate. But the best option is looking at lenders with flexible loan programs. You can consider reaching out to Piramal Finance for such options. As a leading financial institution, they have designed some of the most borrower-friendly loan programs in the industry.
08-11-2023
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