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Personal Loan

How can you use your loan amount for gifting this Christmas?

Christmas has arrived. It is just a matter of time before you get frantic with shopping and decorations for the 25th. Undoubtedly, Christmas brings together friends, distant families, and members staying at different places. Plus, the event marks the end of the year and the beginning of a new phase in life. So, everyone has the right to celebrate it in a blasting and grand manner. But sometimes, you need help to do what you want to. For instance, if you plan to throw a large Christmas party on the lawn, you might face a financial crunch. Similarly, when you have to buy an array of gifts for the occasion, you can have a shortage of funds. There should be no compromise with the Christmas gifts and celebrations. So, the best option you have is a personal loan. Although it might sound a bit weird to have a loan to buy Christmas gifts, it’s of no harm. Keeping this in mind, we have shed light on a personal loan for Christmas gifting. This will help you understand certain aspects of credit quickly. Furthermore, you can also know the ways to utilize the funds for buying gifts. [B-01] Can you get a personal loan to buy Christmas gifts? To begin with, everyone must know if they can get a personal loan to buy Christmas gifts. Although there is no hard and fast rule on the price tags, you probably want to buy something special. For this, you need a lot of savings. Additionally, if you have to get more than a couple of gifts, your savings might not permit you. Therefore, taking out a personal loan sounds more feasible. You won’t have to explain the reasons for taking the credit. Since it is a personal loan, you will have the freedom to use it anyway. So, not only can you buy expensive gifts for your loved ones, but you can also get the decorations started. You won’t get a personal loan classified under Christmas, as you can get one for medical emergencies or weddings. Therefore, you need to apply for regular credit. How can you use the personal loan for Christmas gifting? You can use the personal loan for the following Christmas gifting option: Buying a car for yourself or your loved one Giving gold or diamond jewelry to your mother, sister, or partner Purchasing a new house or renting a new residence Giving gifts to your employees for the small business you started Buying electronics for your new home Getting the best pieces of furniture for the house What are the different loan options for gifting this Christmas? You can find different types of personal loans for Christmas gifting purposes. You must know all these types to avoid being in a difficult position later. Therefore, we have discussed a few classes in the below section. From here, you will get a brief idea about the personal loan types suitable for gifting this Christmas. Unsecured loan: You can quickly get an unsecured personal loan from any creditor. You won’t have to give anything for the collateral. So, your precious assets will be safe from the risks of forfeit. Furthermore, you can ask for a lower principal amount to avoid the dangers and higher interest rates. Secured loan: Another type of personal loan is the secured loan. Here, you have to give something as collateral. However, the asset valuation should be equal to the loan amount. If you fail to pay the debt, the creditor can leverage the collateral to get back the money you borrowed. Payday personal loan: This is an excellent option for having enough funds to buy Christmas gifts. The loan approval depends on your income statement. You must repay the amount and the interest before the next paycheck. Since the tenure is short, you won’t be able to get a higher amount for the loan. Instant personal loan: One of the best options is instant credit. True to its name, you will receive the funds in your account instantly. Creditors take 24 hours to process the funds. But the interest charged is relatively high. So, you should be very specific if you want to get a personal loan. How to get the personal loan for Christmas gifting approved? Since you know the personal loan types, you must know the factors influencing the approval. With an initial idea, you might get the support fast. In addition, the chances of loan application rejection will also increase. So, here are some of the factors to consider before applying for a loan. Your credit score needs to be high, more than 700. If you want the best Christmas gift for your loved ones, maintain a high score. If not, creditors can reject your loan application. Since it is a personal loan, you have to present income proof. It can be your salary statement for the last six months. If you own a business, show the ITR reports to the creditor. You must also choose the best creditor offering personal loans for Christmas gifting. For secured and unsecured loans, private and public lenders will be best. But you can use online or private lenders for payday and instant loans. Ensure to keep all the documents in place. If the papers are improper, the creditor can reject the personal loan application. Compare the interest rates for different creditors. This will help you to understand which loan option will be more feasible. After all, there is no point in paying more than you can afford. Also, it would be best to take a loan with no commission and processing fees. You can discuss the same with the creditor before accepting the loan. [B-02] Conclusion In this article, we have walked you through the best ways of utilizing a personal loan for Christmas gifting. We have also discussed the loan types and factors influencing loan approval. To learn more about personal loans, you can check the details at Piramal Finance website.

08-11-2023
Personal Loan

Instant Personal Loan Online In India Upto 5 Lakh

A personal loan is a convenient financing option. Many lenders are willing to offer instant personal loans online. These loans do not carry any restriction on the use of the funds. Thus, they are very attractive for all those times when you need instant funds to meet your standing financial needs. A lender will check your eligibility to grant an instant personal loan. Accordingly, you can get loans for varying amounts. The multiple features of an instant personal loan make them very feasible for your financial needs. [B-01] Features And Benefits Of Instant Personal Loans There are many benefits of getting an instant personal loan online. Take a look at some of them here. Easy Sanction Most lenders provide hassle-free sanction of an instant personal loan. With this money, you can meet all your financial needs. There is no restriction on how you would like to spend the money. Instant Approval Lenders will assess you based on a few simple steps. Also, you will need to submit a few basic documents. This will help you get approved for a loan in a few simple steps. It takes only a few minutes to get approval for the loan. Collateral-Free Funds You will not need to pledge any securities or assets. Your funds will be disbursed in no time. Online Availability Of Facilities You will get access to an online loan account. Here, you can check your statements and manage all payments. Thus, you can use one account to manage all actions. These online facilities bring all information to your fingertips. Easy Repayment Period Most lenders let you choose the time frame within which you would repay the debt. It can be anywhere between 6 months to 84 months. So, you can match your capabilities and select a repayment period that does not put a financial strain on you. Personalised Loan Deals You can easily get a pre-approved loan from Piramal Finance. The quick processing and disbursal of loans are just one benefit. You can also avail of exciting deals that will make your loan more fruitful. At Piramal Finance, you can get the best loan options. So, it is easy to get a loan for INR 5 Lakh and meet your financial needs with it. How Much EMI Will I Pay? Your EMI on an instant personal loan online depends on the repayment period and rate of interest. So, for example, if you had to repay a loan of INR 5 Lakh, and the applicable rate of interest is 13%, then you could end up paying the following EMI. TENUREAPPROXIMATE EMI 2 years23,771 3 years16,8465 years11,378 Eligibility Criteria To Get A Personal Loan You need to satisfy a few basic criteria to get an instant personal loan online. You should be an Indian national. Your age should be between 21 to 67 years. You should have a CIBIL score of 750 and above. You can use an EMI calculator at Piramal Finance. It is a free online tool that helps to get accurate results in no time. It will help you plan your loan efficiently and decide on various factors. How To Apply For A Personal Loan Online At Piramal Finance? Getting an instant personal loan online at Piramal Finance is very easy. All it takes are a few simple steps to process the loan. Here is a quick guide to help you understand how to apply for a personal loan online at Piramal Finance. Visit the official website of Piramal Finance. Under the loans section, click on the option to apply online. You will be shown an application form. Fill out all your details in this form. You will need to verify your details. Enter the OTP that you receive on your phone. Proceed by filling in your basic KYC details. You will also need to provide details of your employment and income to the lender. Upload the requisite documents online. Make sure that the form is filled out completely. After completing all these formalities, a representative will contact you. They will guide you with the further steps for availing of the loan. Generally, the process for loan approval will take less than a day. Sometimes, it can take up to 72 hours if any discrepancy is found and needs correction. After this, the amount of INR 5 Lakh will be transferred to your account. Usually, it takes less than 24 hours for the transfer to take place. You can check your registered bank account for the funds. What Is The Fee And Charges For The Loan? Piramal Finance offers the most competitive charges for their instant personal loan. They have no hidden charges at all. Here is a breakdown of the type of charges that you will have to pay on the borrowed loan amount. Interest Charges Loan processing charges Interest in an overdue EMI Charges for cheque bouncing Charges for loan cancellation Getting your loan approved at Piramal Finance is as simple as reciting the alphabet! Use our professional loan calculator and check your eligibility. Select your loan tenure and upload documents to find out the amount disbursed. [B-02] Conclusion It is easy to get your loan of INR 5 Lakh. With Piramal Finance by your side, you should not worry about funding your needs anymore. You can get a versatile personal loan at your comfort. Use the funds for a variety of purposes, without any restrictions. The documentary requirement is minimal and the application process is quick. If you want to gain more insights into the world of finances, you can read more blogs at Piramal Finance. Get equipped with the financial knowledge that will keep you one step ahead of your peers.

08-11-2023
Guide

What is Interest? Types and Examples Explained

Have you ever wondered what “interest” is? And what are the different types of interests? In this blog post, we’ll explain how interest works, the different types of interest, and give some examples of each. So whether you’re a seasoned pro or a complete novice when it comes to interest rates, read on for enlightenment! [B-01] What is Interest? Interest is the charge paid for the use of money. It is typically expressed as a percentage of the sum borrowed. It is also the price paid for borrowing money, usually over some time. When you take out a loan, you agree to pay back the principal plus interest. The amount of interest you pay depends on the terms of your loan agreement and the type of loan you have. For example, if you have a fixed-rate mortgage, your interest rate will remain constant throughout the life of your loan. With an adjustable-rate mortgage, your interest rate may change periodically. These depend on market conditions. In either case, interest is an important factor to consider when taking out a loan. In addition to loans, interest can also refer to the return on investment (ROI) earned on an account or security. When you invest money in a savings account or mutual fund, you earn interest on your investment. The amount of interest earned depends on the type of investment and the current market conditions. For example, if you invest in a high-yield savings account, you will earn more interest than if you invest in a low-yield account. Similarly, if you invest in a bond that pays a higher interest rate than other bonds, you will earn more money from your investment. So, when choosing an investment, it is important to think about both the current interest rate and the expected return in the future. Types of Interest Whether you’re taking out a loan or investing your savings, understanding how simple and compound interest work can help you make choices that are in your best interests. Nevertheless, it’s important to know how different types of interest are calculated. This will enable you to make informed decisions about borrowing and lending money. Simple Interest Simple interest is a quick and easy way to calculate the interest charged on a loan. It is simply the amount of money borrowed, multiplied by the interest rate, and divided by the number of days in the loan period. Simple interest is easy to calculate. But it does not take into account the time value of money. This means that the borrower pays less interest overall than they would if they were charged compound interest. However, simple interest can be a useful way to compare different loans. When considering a loan, it is important to look at the total cost of the loan. This includes both the principal and the interest charges. By understanding simple interest, you can make informed choices about borrowing money. All in all, with simple interest, the interest charged is a percentage of the principal amount borrowed (the amount of money you lend). Example of Simple Interest When it comes to deciphering your finances, there are a lot of different formulas and terms to know. However, one of the most basic concepts is simple interest. Essentially, simple interest is calculated by taking the principal, or initial amount, and multiplying it by the interest rate and the number of periods. S.I = PRT In this formula, P equals the principal investment amount. R equals the annual rate of interest. T equals the number of years the money is invested for. So, if you had a loan with a principal of ₹10,000 and an interest rate of 5% for two years, your simple interest would be 10,0005/1002 = ₹1000. Of course, lenders typically compound interest. This means that they add interest payments to the principal balance. So it’s important to know how that affects your overall repayment amount. Nevertheless, understanding simple interest is a helpful first step in managing your money. Compound Interest Compound interest is the interest that accrues on an initial principal sum and any accumulated interest from previous periods. The effect of compounding depends on the frequency of compounding, or how often interest is added to the principal. The more frequently compounding occurs, the greater the effects of compounding will be. Compound interest can have a significant impact on long-term growth. This is why it’s important to understand how it works. Example of Compound Interest At its simplest, compound interest is calculated by multiplying the principal amount by one plus the annual interest rate raised to the nth power of time in years. The formula looks like this: CI = P(1+ r/100)^n-P In this formula, A equals the final accumulated value of the investment P equals the principal investment amount r equals the annual rate of interest n equals the number of times per year that interest is compounded t equals the number of years the money is invested for For example, let’s say you invest ₹10,000 at a 5% annual rate of return with annual compounding. After 2 years, your compound interest would be ₹1,025. If you left that same investment untouched for 20 years, CI would be worth ₹16,532.97. As you can see, compound interest can have a significant impact on long-term growth. That’s why it’s important to understand how it works and factor it into your investment plans. [B-02] Conclusion At the end of the day, loan interest is a way for lenders to make money. So borrowers need to be aware of what they’re getting themselves into. By understanding how interest rates work and being mindful of associated fees, you can take out a loan with confidence and avoid any surprises down the line. We hope that now you are all clear about interest rates and their different types. But if you still need help with any of your financial doubts and concerns related to interest rates, you can contact finance experts at Piramal Finance!

08-11-2023
Guide

Compound Annual Growth Rate (CAGR): Formula, Calculation

‍‍The Compound Annual Growth Rate (CAGR) is a metric used to measure the growth of a specific investment or financial asset over a period of time. It shows how fast an investment or financial asset grows year after year. In this article, we will explore what the Compound Annual Growth Rate is and how you can calculate it. We will also look at examples of how you might use the CAGR calculator in your daily investing pursuits. [B-01] What is the Compound Annual Growth Rate? The Compound Annual Growth Rate, also known as CAGR, is a metric used to measure the growth of an investment or financial asset over the years. In other words, it shows the rate of change in an investment or financial asset from one year to the next. The CAGR can be calculated by taking the annual change in an investment or financial asset and dividing it by the annual change in a reference period. CAGR Formula and How to Use It Here’s the CAGR formula in its mathematical form: CAGR = (FV / PV) 1 / n – 1 When using this CAGR formula, you will have to enter the future value of the investment in question in the place of “FV” and the present value of the investment in the place of “PV.” Then, in place of “n,” enter the number of years since the investment was made. Lastly, perform the function ‘n-1’ and enter the value in the formula. It will return the CAGR on the said investment. Let’s look at an example to better understand how it works. Consider, for example, that you invested Rs. 40000 in a fund in 2010. Now, assume that the investment that you have made will be worth Rs 80000 in 2025. You can now use the CAGR formula above to calculate the growth that you have earned annually with his fund. CAGR = (80000/40000) 15/15-1 CAGR = 7.18% A CAGR of 7.18% means that you earned a return of a little over 7% annually on your investment in the said fund for ten years. If you’re working with a large set of data, you should not perform calculations for each set. Instead, use the dedicated CAGR formula for Excel. CAGR formula in Excel: ‘=POWER (Ending Value/Beginning Value, 1/9)-1’. Terms to Understand Before Using the CAGR Formula To calculate growth using the CAGR formula, you need the following information: Annual change in the investment or financial asset: This is the total increase from one year to the next. For example, if an investment increases by 10% in one year and then increases by another 10% in the following year, that is also a 10% increase. Annual change in a reference period: This is the increase from one year to the next that you are comparing the investment or financial asset. For example, if an investment increases by 10% in one year and then increases by another 10% in the following year, the reference period is the following year. Annual compound interest rate: This is the interest rate the investment earns on your initial investment. For example, if an investment earns 10% annual compound interest, you can use this rate to calculate the growth using the CAGR formula. Uses of Compound Annual Growth Rate These are the two common uses of CAGR: Looking at Investment Returns Over Time When evaluating the returns of an investment or financial asset, the CAGR metric can help investors and financial advisors see how the return has grown over time. It can help determine whether the current return is satisfactory or whether it is time to switch investments. Track the Sustainability of a Business Model CAGR can also help determine the sustainability of a business model. For example, if you are evaluating a company’s growth over a certain period of time, you can then compare this growth to the overall growth of a particular industry. If a company is growing faster than the overall industry, it might indicate that it is having success. Common CAGR Applications Investment Returns When investors are trying to decide whether to keep investing in a certain financial product or asset, CAGR can help them determine whether they have made the right decision. In other words, if they have kept the same amount invested over time, they may have made the right decision. Business Model Valuation When investors look at how long a business model is likely to last, CAGR can help them decide if it’s worth continuing to hold on to their investment. Asset Valuation When investors are trying to determine the value of their assets, such as investment property or businesses, CAGR can help determine the growth of the asset over time. CAGR Calculator and Its Benefits A CAGR calculator is an online tool. It is designed to allow the user to enter the variables involved in calculating CAGR. Once the variables have been entered, the calculator returns a value, which is the CAGR. There are many benefits to using an online CAGR calculator. It eliminates the chances of any errors in calculation. CAGR is often used to make vital business and financial decisions. An incorrect CAGR can prove disastrous for an investor. Therefore, ensuring that the calculation is error-free is critical. A CAGR calculator makes the calculation easy. A user must enter the data, and the calculator returns the CAGR in numbers. The entire process takes less than a minute. You can use a CAGR tool to test various scenarios before investing. It would give you an idea of the end result in each scenario before you invest. It can help you avoid investing in the wrong stock, property, etc. [B-02] Conclusion Calculating CAGR can help investors, financial advisors, and business owners determine the sustainability of their investments in terms of growth and sustainability. It allows them to make informed decisions about their investments and the prospect of growth. When calculating CAGR, it is vital to ensure that all the entered values are free of errors. To be 100 percent sure of the calculation, you can use an online CAGR calculator. Whenever performing financial calculations, remember to use calculators built by reputed financial institutions like Piramal Finance. Reading their detailed blogs will give you an idea of how to use CAGR in day-to-day decision-making.

08-11-2023
Guide

What Is Compound Annual Growth Rate

The compound annual growth rate is the rate of return on investments for a specific period. CAGR is the best way to calculate the accurate rise and fall in investment as it finds the rate of return and helps in the comparison of multiple stocks. With CAGR, a person can see which stock did the best in the market index and even judge the best way to invest. You can compare overall investment and year-end investment growth. But it must be noted that it does not reflect the risks of investments. [B-01] Purpose and Meaning of CAGR The main purpose is to define the profit earned from investment. The compound annual growth rate helps one make a sound financial decision. It tells you the growing distance between the whole year and the year-end investment. However, the right investment provides a profit at the end of the year. The compound annual growth rate is better for smooth results. How to Calculate Compound Annual Growth Rate Anyone can calculate the compound annual growth rate using the formula below: CAGR = [(EV/BV) 1/N – 1) X 100 Where: EV stands for ending value RV stands for beginning value n stands for the number of years You can follow these instructions for CAGR calculation: Calculate the ending value with the starting value Divide the result by the number of years Subtract the result from 1 Multiply the result by 100 to convert it into a percentage Examples of Compound Annual Growth Rate The example is based on assumptions. Let’s assume the investment is $10,000 in a portfolio with the below-mentioned returns: From 01 January 2017 to 01 January 2018, the portfolio grew by $3,000. That is a 30% growth in one year ($10,000 to $13,000). On January 1, 2019, the portfolio was raised to $14,000 (a 7.69% rise in one year). On January 1, 2020, the portfolio was raised to $19,000 (a 35.69% rise in one year). You can see the low growth rate in 2018-19. But it rose in 2019–2020 using compound annual growth rates. The overall CAGR is 28.86% and can be calculated using this formula: CAGR = ($19000/$10000)1/3-1 X 100 = 23.86% This compound annual growth rate can help in future decisions. Any investor can compare shares or bonds and can assess rises and falls. For example, if one share is rising and another is falling, the investor can use the compound annual growth rate and smooth the movement. They may invest or choose to take the risk. Here is another example: Mr. A bought 55 shares in January 2018 at $1,100 per share. The total investment is $60,500. After 3 years, in January 2021, the current price per share will be $3,200. Now the investment is $176,000. The calculation using the formula is: Starting amount = $60,500 Ending amount = $176,000 Number of years = 3 CAGR = [(176000/60500)^(1/3)-1 = 35.69 This is how to calculate CAGR on investment. Additional Uses of the Compound Annual Growth Rate These are some of the additional uses of the compound annual growth rate: CAGR can calculate the return on single investments. CAGR can smooth the return in an inconsistent growth period and help in steadying growth. CAGR can predict changes and save the investor’s money with the right calculations. Track Performance With CAGR Compound annual growth rates can track performance. You can use the formula with the starting and ending investment amounts and the number of years to get the result in percentage form. For example, a five-year period of supermarket sales shares using CAGR is 1.82%. But customer satisfaction is -0.55%. In this way, the compound annual growth rate can show the highs and lows of a company. Detect Strengths and Weaknesses Using CAGR You can calculate the CAGR of other companies, compare them, and predict their rate of return. This practice will help you find the strengths and weaknesses of a competitor. You can raise your returns with positive measures, provide the best services to customers, raise your share value, and help you earn extra returns on your investment. How Do Investors Use CAGR The investor uses the compound annual growth rate to assess returns. The formula calculates past and present returns and helps predict future gains and losses. The calculation can turn a complex history into a simple percentage. It helps with comparison and improves decision-making. Here is an example: Suppose an investor needs $55,000. He gave me $15,000 to invest for the best returns. So, how much is the rate of return to turn $15,000 into $55,000? Investors will use this formula to find the answer. CAGR = [(55000/15000) – 1 x 100 = 5.66% The investor has used the formula to find the returns. Now, the investor is free to compare and invest. What Is a Good Compound Annual Growth Rate Every investor uses a different context for CAGR calculations. Mostly they use two factors: opportunity cost and risk in the investment, and these two factors are important for good returns on investment. For example, a company’s industry rate is 30%, but its CAGR is 35%. But another company’s industry rate is 10%, and the compound annual growth rate is higher. In general, a higher CAGR brings higher returns on investment. The CAGR may go into negative numbers, and this indicates a loss in investment. [B-02] Conclusion The compound annual growth rate helps assess return earnings over investments and helps in the return calculation for a specific period. It can compare past and present performance and also help predict future rises and falls to save investors from losses. The compound annual growth rate might not be 100% accurate but it does provide an idea of investment decisions. You can reverse the formula and get your desired results as well. For more information on the meaning of CAGR, visit Piramal Finance for similar articles and more information and guidance.

08-11-2023
Personal Loan

Fixed vs. Reducing Balance Loan EMIs in 2022

Home loans in India have become very affordable today thanks to the growth of both public and private sector banks, non-banking financial institutions (NBFIs), cooperative banks, and other financial institutions. According to the website www.livemint.com, the strong monsoon of 2022 has given a strong push to the demand for home loans in 2022, especially in Tier 2 and Tier 3 cities. A news report on business television also stated that home loans in 2022 rose to over Rs. 18 thousand crores, a 16% growth over the previous year. It is thus clear that post-pandemic, the appetite for home loans shown by Indian consumers in 2022 is growing at a fast rate. [B-01] Types of home loans in India There are two types of home loans that you can apply for: Fixed balance loans Reducing balance loans In this blog, we will show you how to get the maximum benefit out of your home loan by deciding on the type of repayment structure (called “Equated Monthly Instalments – EMIs“) that you should choose. Equated Monthly Instalments (EMIs) You have purchased your dream home by taking a home loan, which you need to repay with interest. You have to pay back a fixed amount every month for the duration of the loan period, which is calculated in “number of years.” This monthly repayment is called an “Equated Monthly Instalment” or EMI. Types of EMIs When you select your loan, you are presented with two repayment options: A fixed interest rate EMI A reducing interest rate EMI You should know the difference between these two types of EMIs to make the best decision for your home loan requirements. What is a Fixed Interest Rate EMI? In a fixed interest rate EMI, the rate of interest is the same for the entire loan period (called the “tenure”). The interest for the entire tenure is calculated at the start of the loan period. What is a Reducing Interest Rate EMI? In an EMI with a reducing interest rate, the interest amount is variable, depending on the principal amount that is outstanding based on the current interest rate. How do you calculate your EMI under both options? You can determine the EMIs payable under both options by using the following formulas: Fixed Interest Rate EMI Interest to be paid = (Loan principal amount x total duration in years of the loan x interest rate per annum) / total instalments Let us assume that you have taken a loan of Rs. 1,00,000 for one year at a 12% rate of interest Under the Fixed Interest Rate EMI method, the interest is calculated on the principal amount. The interest amount – Rs. 12,000 – is added to the principal amount, giving a total loan value of Rs 1,12,000. This amount is divided by the total number of instalments Thus, the EMI payable is Rs 1,12,000 / 12 = Rs 9,333.33 Reducing Interest Rate EMI Interest to be paid on each instalment = The remaining loan amount x the interest rate that is applicable for each instalment In our example, under the Reducing Interest Rate EMI, the interest is calculated on the total amount outstanding at the beginning of each month. As the total amount decreases, the EMI also decreases accordingly. In this example, the total interest amount is Rs. 6,619, and you need to repay a total of Rs. 1,06,619 after 12 months. Therefore, your EMI will be Rs. 1,06,619 / 12 = Rs. 8,885. As you can see, the EMI and total loan repayment are lower under the Reducing Interest Rate method. What factors affect EMI calculations? According to the Economic Times, the EMI on your home loan depends on the following three factors: The loan amount: the total amount that you have borrowed The interest rate: the rate at which interest is charged on the amount that you have borrowed The duration of the loan: the time frame in which you have to repay the entire loan (principal + interest). This is mutually agreed upon between you as the borrower and the lender [B-02] Pros and Cons of Fixed vs. Reducing Balance Loans in 2022 Here are the important pros and cons of both EMI types that you should keep in mind when deciding which will work better for your home loan repayment: Fixed Interest Rate loans The biggest advantage is that the monthly amount to be paid does not change throughout the loan period. This helps you better plan your monthly budget The interest rate is also fixed and does not fluctuate up or down with changes in interest rates announced by your bank However, the same benefit of a fixed interest rate can also be a disadvantage because you could pay a higher rate of interest even if your bank reduces its interest rate. While the interest rate could be lower in Fixed Interest Rate loans, the EMI amount that you pay will also be higher. Reducing Balance Rate loans Under this method, you pay a lower interest rate over time because it is calculated on the principal amount that has to be repaid. Thus, the interest on your loan will gradually reduce. However, the interest rate in this method is more complicated The EMI amount that you pay is also not a fixed amount for the entire loan duration, and this could lead to complications in your annual budgeting or financial planning. [B-01] Conclusion Home loans are a necessary and convenient way of financing your house purchase. Regular instalments, known as Equated Monthly Instalments, or EMIs, are the way in which you pay back your loan, over a fixed period of time. However, you must decide on the best method of EMI payment—whether Fixed Interest Rate EMIs or Reducing Balance Rate EMIs. This decision should be made as per your home loan requirements, and you must always consult your financial advisor to make an informed decision. Visit https://www.piramalfinance.com/ to learn more about how to choose the best EMI method to repay your home loan easily and conveniently, without breaking your savings or finances.

08-11-2023
Personal Loan

Personal Loan For Low CIBIL Score And How To Improve Credit Score

A personal loan is the best way to meet unexpected financial needs. When you apply for one, the CIBIL score is the first thing a lender checks. Acquiring a personal loan for a low CIBIL score can be challenging. But this is not impossible. You would be required to make some changes to get the loan. But the best option is to improve your credit score. This will open opportunities for you to take loans in the future easily. Read through this guide and get all your answers quickly. [B-01] Understanding CIBIL Score CIBIL score is a measure of your creditworthiness. Credit Information Bureau (India) Ltd is an institution that calculates credit scores. It is a credit rating agency authorised by RBI. The CIBIL score rangess from 300-900. A score above 700 is considered daily good for a loan. Any score below 500 can lead to the rejection of the loan request. A personal loan for a low CIBIL score is not easy to acquire. The following points are included in calculating credit score: Payment history for 30%. Credit exposure for 25% Credit type and duration for 25% Other factors like an active loan and number of queries for 20%. Top reasons for low credit score The CIBIL score comprises four things. A delay in fulfilling any of these can cause a low credit score. The top factors are: Poor payment record for the existing credits. It can be delayed repayment of loan EMIs or credit card instalment. Frequently paying partial EMIs is a reason for low credit scores. Submitting multiple applications for new loans and credit cards can have a negative impact too. Rejection of a credit application increases the chances of a low credit score. A high credit utilisation ratio causes low credit scores. A poor mix of credit choices also lowers the credit score. A low credit score can result from an error in credit calculation. Factors considered for a personal loan A personal loan is an unsecured loan. You can use it to meet multiple financial needs. This loan is one with quick processing and disbursal. The factors that impact personal loan approval are: Your income CIBIL score Employment history History of previous loan repayment Relationship with the bank Amount required Age Debt-to-income ratio But a personal loan for a low CIBIL score is usually rejected. Lenders avoid this due to the risk of non-repayment. But there are some tips through which personal loan for low CIBIL score holders is possible. Tips to get a personal loan for a low CIBIL score If you want a personal loan for a low CIBIL score, here are a few tips: Go for a smaller amount A small personal loan for a low CIBIL score is the first solution. A lender will consider you a risk if you apply for a high amount with a low credit score. But if you reduce the number of applications, the chances of approval increase. Most of the time, the lender communicates the amount it can approve. You can consider the same and apply for a lower personal loan for a low CIBIL score. Apply with a guarantor You can apply for a joint loan. Getting a co-applicant to acquire a personal loan for a low CIBIL score is a great solution. The lender will consider the details of both applicants. This will offer you an opportunity to get a high-value loan too. Also, the co-applicant will share the responsibility of repayment. This will help you to improve your credit score as well. Present proof of income to support repayment A big concern with lenders is the repayment of loans. If you apply for a personal loan for a low CIBIL score, the risk of non-repayment is high. The solution is to present an income source to support your repayment schedule. You can share the details with proof if there is an increase in income. This will increase the approval probability. Check for errors in the credit report There might be errors in the credit report. You can spot those errors and raise a query with CIBIL. Reporting such errors can help you to increase your credit score. Ensure that you have the necessary information on your report when you apply for a personal loan for a low CIBIL score. Check with another lender Sometimes, banks might not approve a personal loan for low CIBIL scores, but other financial institutions will. You can go for NBFC or private finance and get your loan. There might be a change in interest rate. But the chances of approval are high. Tips to improve CIBIL score If you are facing issues with applying for a personal loan for a low CIBIL score, you can try to increase the same. Some of the tips that you can use to improve your CIBIL score are: Check your Credit Report Start with checking your credit score. See if you can rectify any errors. Ensure to get the error is rectified at the earliest. Pay outstanding bills Make sure that you pay off all your credit bills on time. You should make sure that there are no lapses in EMI payment. Credit use An important factor that can improve credit scores is improving credit use. You should use only 30% of the credit available to you. Overuse of credit impacts your score. Maintaining credit use can help in improving scores. Use old cards or accounts You should avoid closing your old cards and accounts. Since you are already using these cards for a long time, it’s better to keep them used. This will help you build a good credit history. Have proper credit max If you wish to apply for a personal loan for low CIBIL score, you should have a proper credit mix. A proper weightage and mix of different credit options will help improve your credit score. Limit the number of hard inquiries Multiple credit applications lead to hard inquiries. The higher number of hard inquiries will increase the risk of low credit scores. It will reflect that you are dependent on debt more than income. Avoiding many hard inquiries quickly will help improve your credit score. Consolidate your debts If you have multiple debts, consolidate them. You can pay it off by using a personal loan. Keeping limited debts in your portfolio is always a wise decision to make. [B-02] Conclusion A personal loan with low CIBIL score is hard but not impossible. You can still take the loan you need with proper planning and time. You should always look for alternatives or solutions in such cases. The best is always to improve the CIBIL score. Simple tips can easily improve your credit score. Building a good credit habit is indeed the key to your problem. Maintain a good credit mix and avoid overspending to start with. This will improve your credit score. Also, you can visit Piramal Finance to apply for a personal loan for low CIBIL score. It’s a quick, simple, and efficient process that will save you time and offer you the funds needed.

08-11-2023
Credit Score

Does a Gold Loan Increase a Credit Score Fast?

Gold loans have become quite a rage in India over the last few years. The country’s burgeoning gold industry has increased demand for loans against the asset. It has resulted in banks offering several such loans, which individuals, as well as businesses, can avail of. In this article, you will find out whether a gold loan can help improve your credit score and the other benefits of taking a loan with gold as collateral. [B-01] What is a Gold Loan? A gold loan is a loan wherein the borrower sells gold to the lender and receives a loan against the same. The borrower provides gold on a pledge, and the lender exchanges the loan. It is one of the oldest types of collateral, which is why gold has been used as currency for so long. The gold loan has become popular again due to the increasing demand for bullion in the country and the low interest rates on offer by banks. How Does a Gold Loan Work? The gold loan works on the principle of pawnbroking. It means that the lender takes possession of the gold and holds it as security for the loan. The borrower is responsible for paying interest on the loan amount. This interest is charged as per the prevailing interest rate of the lender. The borrower pays interest on the loan amount plus the principal amount of the gold. Gold loans are popular again because of the increasing demand for gold in the country. Can Gold Loan Improve Credit Score Fast? If you’re looking to improve your credit score fast, a gold loan might be your best option. A gold loan is a small, short-term loan that uses gold as collateral. It means that the lender has access to your gold, and if you fail to repay the loan, they can sell it at auction. Because a gold loan is a short-term loan, it’s good for improving your credit score. It is because short-term loans are usually considered less risky than longer-term loans. And, given that a gold loan is a low-risk commitment, it is a viable option to improve your credit score. It would help if you had good credit to get a gold loan – meaning your credit score should be above 650. It would help if you also had enough gold to collateralize the loan. And finally, you need to agree to pay the loan back within a set period. Because a gold loan is considered a low-risk loan, you won’t have to worry about high-interest rates or other penalties. What is a Credit Score? A credit score is a numerical rating assigned to an individual or a business by a credit report provider. A credit score is a reference that lenders use to decide whether to accept a loan request. A credit score is a three-digit number between 300 and 850. The higher the score, the higher the chances of getting a loan. The credit score is calculated based on the following factors: Payment history: How much have you paid on loans in the past? Credit utilisation: How much of your total credit limit have you used? Length of credit history: How long have you been taking credit? Payment speed: How quickly are you repaying your existing loans? Credit mix: How many different types of credit do you have? How to Improve Credit Score with Loan? A good credit score is essential for anyone looking to borrow or take out a credit card. Fortunately, there are several ways to improve your credit score. Here are four tips: Pay your bills on time: This is the most important step; if you can’t pay your bills on time, your credit score will suffer. Make sure to pay all your bills on time each month, and keep track of how much you’re borrowing each month so you know where you stand. Keep your credit reports clean: If any accounts have been cancelled or closed, update your credit report as soon as possible. It will help improve your score because it shows that you’re taking responsibility for your actions. Use a credit card responsibly: Don’t use your credit card to buy things you can’t afford; this will damage your CIBIL score. Instead, use it to buy things you can afford and pay off the balance in full each month. Get a gold loan: A gold loan is a type of loan that has low interest rates and a limited prepayment penalty. It is a good option if you want to quickly improve your credit score. Many Benefits of Gold Loan There are various advantages to taking a gold loan. Some of them are given below: A secure transaction – Gold has been used as a currency for thousands of years. It has therefore been considered a secure investment for a long time. Therefore, using gold as security for a loan is a secure choice. When you take a gold loan, you already have an asset you can sell in case you’re unable to pay off the loan. Easy access to money– A gold loan is akin to an equity investment in terms of ease of access. The process of getting a gold loan is relatively faster. It takes less time than a personal loan. It is so because you’re keeping gold worth the entire value of the loan with the bank. Relatively low-interest rates – Banks’ low interest rates make gold loans quite attractive. Banks usually allow interest rates between 5% and 9% per annum. In comparison, most personal loans come with an interest rate of around 10% or above. Loan repayment flexibility – The loan term is usually between 6 months and a few years. Unlike other types of loans, gold loans can be repaid in installments. Why Is Gold Loan in Demand Right Now? The demand for gold in the country is increasing due to the high inflation rate in the Indian economy. People are therefore buying gold as a store of value. This gold loan demand is also boosted by the strong Indian rupee, which makes gold loans even more attractive. Moreover, the falling prices of crude oil have led to a decrease in the price of gold. This has made gold loans even more attractive. The high inflation rate, low crude oil prices, and increasing demand for gold loans have led to a spike in the price of both gold and the Indian rupee. [B-02] Conclusion Gold loans are one of the oldest forms of collateral. They work on the principle of pawnbroking, and the borrower pledges gold as security for the loan. The lender advances the loan in exchange for the gold. Given that gold loans are often taken for short durations, they can easily improve your credit score. At the same time, it is also a safer way when compared to a personal loan. With gold as collateral, there are limited risks involved for both the borrower and the lender. If you have any questions about gold loans or credit scores, you can read the detailed blogs available on the Piramal Finance website for detailed answers.

08-11-2023
RD

Everything You Need to Know About the EMI Network Card in 2022

With so many things on the market, it’s more tempting than ever to buy, but it’s also easier than ever to spend more than you should. There are some of the best appliances, gadgets, and household items on the market, but they are often very expensive. But we don’t let the high prices stop us from buying the things, especially since we have options like cost-effective EMIs to spread out the payments. It’s easy to buy on EMI, and it’s even easier when there’s no interest to pay on the EMI. Many online and offline stores in India, like Flipkart, Amazon, Vijay Sales, Chroma, and others, accept the new EMI Network Card. You can choose no-cost EMIs when you use an EMI Network Card, which means you won’t have to pay too much out of your pocket. The cost of the purchase can be spread out over many months with small payments, giving you more money to invest or spend on other things. [B-01] The Convenience of Making Purchases Online The ability to purchase online at any hour of the day or night, avoid the hassle of struggling through crowds, and save time are three of the many benefits that make online shopping pleasant. The EMI Network Card might be an excellent choice for a financial instrument if you are interested in purchasing the most up-to-date consumer goods, furnishings, or appliances, among other things. You can make interest-free monthly payments on a wide range of different items if you use this card. The EMI Store provides several advantageous features, such as no initial payment required, no interest charged, cash back, and free delivery right to your home. The Network Card is accepted at the checkout of thousands of online stores all around the globe. Buying Things at the Shop is an Easy and Uncomplicated Process Although it is now easier than ever to shop online, there are still certain things, like sofas and appliances, that are better off being bought in person. By using the EMI Network Card at partner stores like Chroma, Reliance Digital, Vijay Sales, and many more, you will have the opportunity to get the most recent and cutting-edge products in easy monthly installments (EMI). You may be eligible to get interest-free payments with this card, in addition to a variety of savings and cash-back options. You may discover a wide variety of lifestyle partner businesses in a variety of locations, which is convenient if you’re looking to do some shopping quickly and at a reasonable cost. Spend Up to 4 Lakh Rupees If you are in the market for a new washing machine or a television with a large screen for your living room, you should be aware that these purchases could put a significant dent in your monthly budget. It allows you to spend up to Rs. 4 lakh, which enables you to get the most recent technological devices into your house. If you have been putting off purchasing a new piece of fitness equipment or air conditioner because of your monthly budget, now is the time to make the purchase and save money without feeling guilty about it. Lengthy Lease Terms, With No Late Fees or Other Penalties Making purchases on no-cost EMIs for a wide variety of goods, including electronics, can be made easy and cost-effective with the use of this card. When you get your card, you’ll have the option to tailor the payback period (which can be as long as 24 months) to your specific requirements. After the initial monthly installment has been paid, there are no additional costs associated with paying off the loan early. Online Registrations Made Simple The card was designed to be compatible with contactless payment systems, making its usage speedy, uncomplicated, and risk-free, not just in physical but also in virtual retail establishments. To apply for the card, all you need to do is make three simple clicks. The whole procedure may be completed digitally and quickly. Your membership card will be sent to you as soon as the membership fee has been paid and the required “Know Your Customer” documentation has been submitted. Make Use of it Both Online and Offline The EMI Network Card, much like other debit and credit cards, can be used to make purchases in-store or online, just like any other debit or credit card. Whether you prefer to shop in person or online, you can use this EMI card to make purchases at your preferred retailer. Simply providing the salesperson with your card information to pay with EMI is required whenever you make a purchase in a physical store. You can choose the EMI option when you are purchasing from an online store that accepts the EMI Network Card. After doing so, you will be able to choose how long you want to take to pay back the purchase, enter any other pertinent information, and then complete the transaction. It is even simpler if you submit your application online. If you are interested in applying, please check out our website or download our mobile app. As soon as you begin the application process, several questions concerning yourself and your background will need to be answered. Some of these are the fundamentals, such as significant documents and pertinent financial information. In addition, a fee of 530 must be paid in order to register. After the application process, you will be informed as to whether or not you have been accepted to receive an EMI Network Card. [B-02] Conclusion With an EMI Network Card in your wallet, you won’t have to make a lump-sum payment for expensive purchases like electronics and household appliances since you can spread out the cost over many months. If you can satisfy the few straightforward conditions, achieving this objective should not present too much of a challenge for you. Get the best EMI Network card with Piramal Finance.

08-11-2023