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Personal Loan

What is the Procedure for an Education Loan?

Education has become a necessity for every citizen in the modern era. However, the affordability of quality education is not the same for everyone. The rising cost of quality education is a growing concern. Many students want to refrain from burdening their parents with the high cost of their education. At such a time, the student may opt for an education loan. To begin applying for an education loan in India, one must first ensure that one satisfies the requirements. Every parent has the same goal regarding their child’s education: to put them in the most prestigious school possible. However, many individuals discover that earning it, particularly from a reputable institution, is financially exhausting. This is especially the case when it comes to the cost of tuition. One way to cover the costs of attending school, particularly for those who want to further their education, is to apply for a student loan. We offer many different kinds of loans, such as mortgages and car and other vehicle loans. [B-01] Eligibility criteria for student loans Nationality To get a student loan, a person must be a citizen or a permanent resident of India. Prerequisite Age Education loans may be applied for by the prospective student or the student’s parents if the prospective student is 18 or older. No one beyond the age of 35 may qualify for a federal student loan. Educational Course Admission The applicant must have proof from the University Grants Commission (UGC), the Indian Ministry of Higher Education (MHRD), the All India Council for Technical Education (AICTE), or a similar organisation that they have been accepted to a university in India. Percentage To continue, a candidate must have scored at least 60% on all prerequisite assessments. A Step-by-Step Guide for Education Loan Getting one is fairly straightforward, and although the application process varies from bank to bank, they all follow the same general steps: Step One: You’ll need to fill out a loan application. The applicant must fill out an application form, which may include questions like: Pictures of you and me, both passport-sized Documentation of completion of secondary school, high school, or its equivalents, such as a diploma or transcript Examples of KYC documents are voter ID cards and PAN cards that provide proof of identity, address, and age Proof of signatures Eligibility for extra money is based on proof of parental income, records for properties, and FDs A person who wants to get an international student loan must provide the following proof that they want to go to school abroad: Two pictures of you, both passport-sized Proof of identity and papers showing the right to work (voter ID cards, PAN cards, and proof of identity, residency, and age) certificates attesting to a recent exam’s success or grade reports Verification of course and university enrolment Set aside money for tuition More copies of the prize letter (if you have one) Bank statements for the last six months from the borrower, parents, or guardian All guarantors, parents, and borrowers must provide transcripts of their current and past years’ federal tax returns. What exactly is being offered as collateral, if anything? To prove its marketability, mortgage-approval prospects, etc., the applicant may be asked to present a search and report from an advocate Proof of relocation provided by candidates Step Two: A Personal Conversation After applying, the candidate is interviewed by a bank staff member, who may ask questions about the candidate’s past academic performance, the specific major or field of study, the school attended, and other factors. Step Three: The applicant needs to provide relevant paperwork. Before a bank considers a loan application, the applicant must provide all admissions paperwork. The bank needs proof of enrollment at the school before approving the loan. If the education loan amount exceeds Rs. 4, the applicant may be required to furnish collateral security, such as documentation related to mortgaging the property. Step Four: Acceptance or Rejection of the Loan A cosigner is needed for a student loan. The applicant’s parent(s) or guardian(s) might serve as the guarantor. Before approving the loan, the bank will look into the guarantor’s credit history. When the process is complete, the bank may decide whether to provide the loan to the applicant. Step Five: the actual distribution of the loan. After all the documentation is submitted, the bank will disburse the loan. The financial institution will cover the cost of college or university by making a direct payment to the school. Submission of an Online Student Loan Application Incorporating an online application has made applying for a student loan much less hassle. Applying for an education loan may now be done entirely online. The bank will only approve the education loan if the applicant and the main contact are physically present at the time of approval and distribution. What does an education loan cover? Starter fees for the class Affordable housing Other college-related necessities In which cases may one apply for a student loan? When a student applies for a loan, the student is the principal borrower, and a parent or sibling may be a co-applicant. The student is expected to repay the loan once he earns an income. If the co-applicant does not find gainful employment, he will be liable for repaying the education loan. What if the person cannot afford to pay back the loan? The bank may sue them if they cannot repay their student loan. However, the lender also faces scrutiny in these cases since it becomes clear that they did not accurately assess the borrower. [B-02] Conclusion The right to education has emerged as one of the most essential of modern times. However, not everyone has the opportunity to afford a quality education; such people can opt for an education loan. You can take help from Piramal Financing House to decide which loan will be best for you.
08-11-2023
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Other

What is the Timing of the Commodity Market in India?

The following article discusses the history of the Indian commodity market. It also informs you about a range of trustworthy brokers and commodities exchanges operating in India. In this post, we’ll break down some of the most technical words used in the Indian commodity market so that even a beginner may understand them. Body: [B-01] Origin of Commodity Trader Organized commodity commerce in India began in 1875 with the establishment of the Bombay Cotton Trade Association. However, the foundation of the commodities market was laid down much earlier than in any other country. Futures markets in jute and other jute products emerged shortly after the Bombay Cotton Exchange was established in 1893. Let’s investigate the nature of commodity trading and why it’s garnering so much attention now. What is commodity trading? Stocks aren’t the only things that investors and traders buy and sell to earn a profit. Profits from the commodity market might be quite attractive if one knows what they’re doing. Commodities are widely traded all over the globe. They are the backbone of any economy. The word “commodity trading” refers to the buying and selling of various raw materials and finished products made from them. Let’s break down each portion of this explanation so you can fully understand it. It all starts with a massive commodity trade. There is a limit on how many units may be acquired at once when buying units. The interaction of supply and demand establishes the market price of an item. What Time Does the Commodity Market Open? The commodity market opens for trading at 9.00 a.m. every day. You can start trading all commodities at 9 a.m. Commodity Market Closing The closing commodity market times for diverse commodities are not uniform in the Indian commodity market. At 11:30 pm EST, the closing bell rings for all commodity trades other than those involving food and agricultural products. The last trading hour for cotton, among other agricultural products, is 9:00 pm. Likewise, the market for all other commodities closes at 5:00 pm. All today commodity market positions must be squared off 25 minutes before the market’s closure, and trade adjustments are accepted till 11:45 pm. Traditional banks such as ICIC Direct and HDFC Securities provide commodity trading services. What Kind of Deals Can You Make in the Commodity Market? The commodities traded on the Indian commodity market fall into two broad categories: agricultural and non-agricultural. Non-agricultural commodities may be further broken down into three groups: precious metals (gold and silver), energy (fuels and ores), and industrial metals (base metals). Among the most frequently bought and sold commodities on the markets are: Black pepper, cardamom, castor seed, cotton, palm oil, kapas, wheat, rice, chana, bajra, barley, and sugar are a few of the many items that come from agriculture. Meant for storage or Exchange, bullion typically consists of silver and gold. Fuels consist of crude oil and natural gas. Base metals are nickel, zinc, lead, copper, lead, and aluminium. Cotton, copper, silver, and gold are India’s most widely traded commodities. Commodity Exchanges: Several Unique Markets Commodity markets may be divided into two categories: Spot markets are also called physical markets or cash markets. Here immediate delivery of items is traded. The derivatives market includes both futures and forwards. Users may schedule an exchange on a certain day and price. Deliveries of the exchanged product take place at the expiration of the contract. MCX, NCDEX, and other exchanges in India are used for trading commodities. Two of India’s most popular exchanges for trading commodities are the Multi Commodity Exchange (MCX) and the National Commodity and Derivatives Exchange (NCDEX). In 2003, the Multi Commodity Exchange (MCX) was established as a marketplace for exchanging non-food commodities. Agricultural products are the primary items traded on the National Commodity and Derivatives Exchange. It has been operational since 2003. Commodities Market Participants are essential to ensuring the fairness of these markets. The vast majority of participants in commodity markets are either hedgers or speculators. Speculators are those who aren’t involved in the production or consumption of products. They enter the market for short periods to profit from price fluctuations. Those who have a stake in the commodity they trade are called “hedgers.” As a result of their dealings, commodity price fluctuations are eliminated. These players contribute to the market’s stability and collaborate to set its direction. How to Make Money Trading Commodities Traders in commodities need a Demat account in the same way that stock traders do. Choosing a broker to open a Demat account with isn’t difficult. Many viable options exist. However, before opening an account, ensure your prospective broker has a solid track record, competitive rates, and low costs. Finding a broker that can provide you with higher margins requires careful consideration. Commodity exchanges conducted through the internet Buying and selling commodities online are similar to trading stocks or other assets. Indian commodity markets may be quite lucrative. Shares can be traded just as easily on the BSE as on the NSE, and vice versa. MCX (Multi Commodity Exchange of India Limited) and NCDEX are the two most well-known exchanges (National Commodity and Derivatives Exchange Limited) for those interested in trading commodities in India. The commodity trading market functions differently from the stock exchange. Commodity trading margin requirements are not fixed like stock trading margin requirements are. Why Do People Engage in Commodity Trade? First, purchasing commodities like gold and silver is the best way to diversify your financial portfolio. Second, the returns from commodities are diversified and risk-adjusted. In contrast to equity commodities, stock market declines lead to price rises. Commodity prices are relatively immune to inflation since they tend to rise when money loses purchasing power. Investment in Basic Materials is Now Appropriate The Indian commodity market is active throughout the year and features trading in various goods. The Commodity Exchange is open during regular business hours, Monday through Friday. Any holidays declared by the Exchange are communicated in advance to the traders. [B-02] Conclusion Primal Financing House provides its consumers with cutting-edge stock trading solutions to make stock trading a breeze. If you are a beginner with a high level of intuition, employing Pirimial Financing House will simplify your investment and trading on the commodities market. You can get their help for the best experience.
08-11-2023
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General Insurance

How to Determine the Right Amount for Your Life Insurance Cover in 2022?

We all know that death is certain, and most people may not want to think about it too much. However, if you have family members who rely on you, it is critical that you have enough investments, such as life insurance. Life insurance can make it easier for those left behind to manage day-to-day living expenses, pay off mortgages or other debts, and cover other expenses. When it comes to life insurance, many people are uncertain as to how much coverage they need. This article will talk about everything, such as what factors affect your coverage amount and how to calculate it. [B-01] What is life insurance? In the event of your death, life insurance pays out money to one or more beneficiaries of your choice. Depending on the type of coverage, life insurance can pay for final expenses such as a funeral or unpaid debts, or it can provide funds to support dependents’ standard of living or future financial needs. In the end, life insurance gives you some peace of mind that your beneficiaries’ financial needs will be met (up to the policy limit, or death benefit) if you die. Factors to Consider Before Selecting Life Insurance Cover Your Age Your date of birth when you bought the coverage is very important. Adults between the ages of 25 and 35 need coverage equal to at least 18 times their yearly salary plus. However, those between the ages of 25 and 45 and 44 and 55 require coverage that is 15 times and 10 times their respective yearly incomes, in addition to having all outstanding loans paid in full. It is recommended to purchase the coverage when you are young and to select the tenure that is the longest. Your annual income Evaluating your present financial situation is one of the crucial elements to consider while choosing life insurance coverage. The basic rule of thumb, which states that your life insurance coverage must be at least 15 to 20 times your current yearly income, is often recommended by consultants. Your financial liabilities or debt Liabilities are an important factor when determining the insurance coverage for your life insurance policy. The life insurance coverage should be enough to cover all of your current and anticipated debts and financial liabilities. Since life insurance ensures that the policyholder’s family will get money in the event of their death, the coverage should be set up so that it enables the family members to settle their debts and live a life free from interference. The benefit from your policy should be enough to pay off all of your current debts, such as credit card bills, mortgage payments, and car loans. Figure out how many other capital assets you have and set the amount of coverage you want to buy based on that. Your Financial Goals The entire purpose of the life insurance plan is to provide for the family’s financial necessities following the death of the insured. Children’s schooling and marriage should at least be included in the coverage because they end up being significant household expenses in modern Indian society. Thus, life insurance cover must pay these costs in the event of the decedent’s death while taking inflation into account. Policy Tenure Life insurance generally has annual premiums. Therefore, it is recommended to purchase a life insurance policy at a young age so you can get coverage for a longer time. Moreover, life insurance premiums are rather cheap when you purchase them at a young age. Methods to Calculate How Much Life Cover You Need Human Life Value (HLV) A figure that indicates the current value of anticipated future income, expenses, debts, and assets is known as the “Human Life Value” (HLV) or “Ideal Life Cover.” The HLV figure is typically obtained to determine how much capital would be needed to purchase term insurance to protect the lives of your dependents if you pass away. Find out how much it would cost in today’s currency if your goal is to maintain your family’s current lifestyle in the future. Also, most insurance providers recommend the HLV method to calculate the coverage amount. Income Replacement This calculation method assumes that life insurance will make up for the lost source of income. “Your insurance coverage = your current yearly salary x the number of years till retirement” is one of the simplest ways to determine your income replacement value. For instance, if you are 40 years old, make 20 lakh rupees a year, and expect to retire at 60, the amount of insurance you’ll need is 4 crore, i.e., 15 lakh times 20. Expenses Replacement In this method, people estimate their living costs, debt payments, and responsibilities like funding their children’s school and caring for financially dependent parents. The amount of coverage calculated from this will be the amount your family requires. Your investments and life insurance must then be subtracted from the calculated amount. You can estimate how much coverage you need by subtracting investments and insurance from spending and goals. [B-02] Conclusion You must consider all these factors before finalising a coverage amount for your life insurance. These factors should have given you a better understanding of your current goals and positions regarding supporting your family financially. It’s a good idea to periodically examine your term insurance needs because you can’t predict everything. Moreover, research and apply only for the life insurance that suits you best. You can also visit our website to read more such blogs and learn about life insurance and finances. You can also check out the housing and personal loan sections if you plan to get one.
08-11-2023
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Other

What is a Trading Account, Its Charges and Eligibility Criteria

Recently, many people have moved toward investing. People are opening Demat and trading accounts every day. You might have noticed that your neighbour has begun to talk about stocks with you regularly. Also, you may have decided to start dealing in stocks to make more money. However, before you take a plunge into the world of trading, you need to know about the ABCs of trading. A trading account is a fundamental aspect of share markets. Understanding them is crucial. So, read this article to learn all the vital information about trading accounts. [B-01] What is a trading account? Are you considering investing in the stock market? As an initial step in becoming a trader, you will need a Demat account. The next step is opening a trading account. A trading account allows you to buy and sell equity shares and bonds. Using a trading account, you can trade shares and securities in the stock market electronically. In what way does a trading account work? Your trading account links your Demat account and your bank account. It debits your shares from your Demat account and credits the money to your bank account. This mechanism for online trading accounts facilitates the sale of your shares. Alternatively, in the case of share purchases, shares are credited to your depository account and the money gets debited from your bank account. Features of a trading account Shares can be purchased and sold online or via smartphone. Expert recommendations facilitate access to the best-performing shares in different categories. If you open an online trading account, you will get free alerts about the market and news. Margin investing allows investors to gain exposure to a variety of stocks. You can trade stocks without any delays with real-time transactions. Unique features help you place orders after the market hour. Expert research advice is available from our team of analysts. Trading account benefits As an investor, you can set your trading limits on your trading account. A trading account lets you buy and sell stocks, gold ETFs, forex, and derivatives. It is easy to perform all sorts of transactions virtually. You do not need physical transactions to buy or sell securities. It builds a profitable relationship between profits and sales to an investor. It provides the perfect ratio between profits and purchased goods. Demat account vs. trading account Functional difference: You can use a Demat account to hold securities in an electronic format. A trading account’s purpose is to allow the trading of stocks on the stock market. It means buying and selling shares on the exchange. Nature: A Demat account works similarly to a savings account. In the same way that a savings account holds money, a Demat account allows investors to have financial instruments in a dematerialized or electronic format. They are debited or credited as necessary. Trading accounts, on the other hand, function more like bank accounts. It is essential to have both a depository account and a trading account. The main purpose of a Demat account is to keep your trading account safe so you can buy and sell shares at any time without risk. Time measurement Trading accounts differ from depository accounts. Depository accounts hold shares and are measured as stocks at the end of each financial year. On the other hand, an account for trading transactions is a flow statement. Choosing the best trading account in India Several service providers are available on the market. So choosing the right one can be confusing. Before selecting your broker, you should consider the following: Searching for a platform with reasonable service charges based on transaction frequency is essential. If you are an equity trader, you can select a provider that suits your needs. The best trading accounts have high-tech platforms that let you trade whenever and wherever you want. To ensure smooth trading, select a reliable and efficient service provider. Charges for Opening an Online Trading Account In India, several stockbrokers provide trading accounts to their clients. In most cases, the expenses associated with a trading account are nominal. You can break the typical fee structure into several categories, such as: A one-time account-opening fee is required. Fees for account processing Annual maintenance fee. A trading account can be opened in various ways, depending on your chosen plan and associated account opening charges. The average account opening fee ranges from INR 0 to INR 975.00, depending on your plan type. Eligibility Criteria to Open an Online Trading Account To open an online trading account, you need to meet specific eligibility criteria, which makes the process straightforward. Age You must be 18 years of age. There is still the possibility of having a trading account if you are under 18, but you can’t buy or sell directly with a stockbroker. Besides, you can only sell securities that the minor can possess, such as IPOs, inheritances, gifts, corporate actions, etc. PAN card You must have a valid PAN card to apply. Demat and bank account You must have a functional depository and bank account. The unavailability of a Demat account can be sorted out by submitting either one of these documents: a cancelled check, a bank passbook, or the most recent 6-month bank statement. KYC documents You need to complete KYC for a trading account. Submitting the below documents will help you complete your KYC process: Income proof: If you wish to trade futures and options, you will need income proof. Providing either of these documents can prove your income: the latest six-month bank statement, the most recent three-month salary slip, and the most recent ITR statement. Identity and address proof: You can present several types of documentary proof: a PAN card, an Aadhaar card, a driving license, a passport, and a voter ID card. Alternatively, you can submit your most recent utility bill or bank statement for proof of address. Also, you’ll need your passport photo and signature on white paper. [B-02] Conclusion If you still need to start trading, there is always time for you to start. Piramal Finance can be a one-stop solution for all your financial needs. It is always necessary to look for wealth-creation opportunities to create wealth. Thanks for reading the information we provided regarding trading accounts. We hope that it has helped you and cleared your doubts. Comment if you agree.
08-11-2023
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Home Loan

Types of Loan: Home loan, Mortgage loan and Loan against property

When it comes to availing loans for either business or personal use, you may come across three types of loans: home loans, mortgage loans, and loans against property. These loans will leave you confused if you are new to the financial market. Although every loan is offered against an immovable asset, be it a house, plot, or commercial property, each one has its own eligibility criteria, repayment tenure, interest rates, and so on. You must understand the key differences between the three loans so that you can choose one according to your needs. Continue reading to learn more about these distinctions and how to find the best loan for you. [B-01] What is a home loan? A home loan is a secured loan that provides you with sufficient funds so that you can buy or construct your dream house. The banks or financial institutions offer a home loan by keeping your property (the one against which the loan is sanctioned) as collateral. Home loans are funded at affordable interest rates and usually have a long repayment tenure. You are supposed to repay the loan amount through equated monthly instalments (EMIs). Once the entire loan amount is repaid, the lender hands you back the title to the property. What is a mortgage loan? A mortgage loan is a secured loan that provides you with funds against an immovable asset like a house or commercial property. The bank or other lender will keep this fixed asset as collateral until you have paid back the loan in full. A mortgage loan is more like an agreement between you and your lender under which you agree to allow the lender to take over your property if you fail to repay the loan amount plus interest. You can use a mortgage loan to buy a property or borrow money against the value of a home you already own. What is a loan against property? A loan against property (LAP) is a secured loan sanctioned against your property by keeping it as collateral. The property may be residential, commercial, or industrial. The property continues to be held as collateral by the lender until the total amount of the loan against the property is repaid. LAP is a loan that benefits both businesses and individuals. Banks or other financial institutions usually offer loans against property at a much lower interest rate than any other unsecured loan. Businesses use this loan to pay suppliers or salaries, keep goods stocked to keep up with rising demand, or pay for operating costs. Key Differences Between a Home Loan, a Mortgage Loan, and a Loan Against Property. Read on to understand the key differences between all three loans—home loan, mortgage loan, and loan against property (LAP)—based on purpose, loan-to-value ratio, and repayment tenure. Home loan mortgage.Mortgage loan.Loan against property.Purpose.To purchase a plot or ready-to-move-in property. Or for the construction of a house or commercial property.No restriction on the usage of the loan amount. Both individual and business requirements can be met.For both business purposes and personal use.Loan-to-value ratio.Up to 90% of the property value.Up to 60–70% of the property’s market value.Up to 60% of the property value.Repayment Tenure.Up to 30 years.Up to 15 years.Up to 15 years. Wondering where to get these loans? After knowing all the key differences between the three loans, you must be wondering where to get these loans with quick application procedures and no hassle. Right? Piramal Finance offers hassle-free home loans and loans against property with minimal documentation and favourable interest rates. Continue reading to learn why you should choose Piramal Finance. Features of Applying for a Loan at Piramal Finance Piramal Finance offers you a loan with no hassle that is worth a try. Read the benefits of applying for a loan at Piramal Finance. There are little to no fees for early repayment or foreclosure. Minimal documentation. Smooth process with quick sanctioning and disbursals. Easy monthly EMIs that fit your pocket Flexible tenure of repayment from 1 year to 5 years. Combining incomes of family members to increase loan eligibility. High eligibility; the maximum loan amount Loans are available for both salaried as well as self-employed individuals. Home Loans and Loans Against Property at Piramal Finance. You can avail yourself of a hassle-free loan with minimal documents and a prompt application procedure at Piramal Finance. Piramal Finance offers a home loan and a loan against property. The table below shows the eligibility criteria, interest rates, documentation, processing fees, and application of these two loans at Piramal Finance. Please note that Piramal Finance does not offer mortgage loans as of now. Home Loan.Loan Against Property.Eligibility.Both salaried and self-employed individuals.Both salaried and self-employed individuals.Interest Rates.Starting at 10.50% p.a. onwards.Starting at 11.50% p.a. onwards.Documents.PAN, identity proof, address proof, income proof, property-related documents, etc.PAN, identity proof, address proof, income proof, property-related documents, etc.Processing Fees.Up to 3% of loan amount+ applicable taxes.Up to 4% of loan amount+ applicable taxes.Application Fees.3500/-+applicable taxes.3500/-+applicable taxes. [B-02] In conclusion The type of loan depends on your requirements. If you are someone who wishes to buy or construct a house, a home loan is a good option for you. And if you are someone who wants to fulfil both business and personal expenses, then a mortgage loan is a good choice for you. Lastly, if you are a business that wants to pay salaries or buy inventory, go for a loan against property. Piramal Finance offers you both a home loan and a loan against property at an affordable interest rate and hassle-free repayment tenure. Apply to get a loan right away, or call 1800 266 644 to learn more.
08-11-2023
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Gold Loan

What Is The Maximum Tenure For Gold Loan?

Gold loans are a great way to meet your immediate cash demands. Suppose you have gold items you want to use during a financial crisis or fulfil other monetary requirements. In that case, you can easily apply for a gold loan without any problem because you can obtain it in a few minutes to 48 hours. The duration of gold loans varies according to the institution. The tenure of repayment for gold loans starts at a minimum of seven days and a maximum of five years. [B-01] Benefits of gold loans Hassle-free documentation: Financial institutions use a relatively easy KYC-based documentation process. The borrower must supply all relevant documentation, such as evidence of identity and address. Income certificates or financial statements are not required in the gold loan application process, as in other loan applications. Reduced Interest Rates: Gold loans are a secured type of borrowing. Hence, lenders charge a lower interest rate when compared to other unsecured advances. No Processing Fee: Banks and publicly traded financial organisations do not charge processing fees because gold loans are granted instantly. No effect of CIBIL ratings: Unlike most loans, gold loans are not based on your financial situation or credit score. The borrower’s repayment limit and previous repayment record determine the advance amount for other unsecured loans. In the event of a gold loan, however, the advance amount is determined by the value of the gold. Safe Gold Storage: The lender is responsible for safely storing the gold jewellery. The gold is secure in their vault, and the borrower does not have to worry about it. Multiple uses: Medical emergency, schooling, business expansion, wedding plans, or the initial instalment for purchasing a vehicle or a property can all be financed using gold loans. Modes of Gold Repayment EMIs, or Equated Monthly Installments, are the most frequent method of repaying a gold loan. This is best if you have a steady income. Use a gold loan EMI calculator to calculate the amount paid in EMIs. People who select EMIs to repay their gold loans enjoy a consistent monthly income stream. The lender would charge monthly interest on the principal in this arrangement. Still, the principal plus interest would be due after the loan term. To keep track of your expenses, you can use a gold loan repayment calculator to determine how much you would have to pay. With a small exception, the monthly payment procedure of a gold loan is identical to that of an EMI. This technique requires simple monthly payments of the interest accrued on the principal amount. The principal is paid only after the gold loan term. The gold loan repayment calculator can help you determine how much interest you’ll pay each month. This repayment plan is also appropriate for low-income borrowers or those who do not have a monthly cash intake. Bullet repayment is appropriate for short-term gold loans of 6 months to 1 year. However, by the time the loan term is up, you will have paid much more interest with the bullet repayment method. Although expensive, this strategy may be suitable for people who do not have a steady source of income and cannot afford monthly payments. Foreclosure refers to repaying the entire loan amount before the loan term expires. Pre-closure money can also be used to settle gold loans. Making partial principal and interest payments is another traditional method of repaying gold loans. You can save money on your loan by making larger payments at the beginning. Repayment Tenure for Gold Loans When compared to most other loans, gold loans have shorter repayment terms. Typically, the maximum payback duration for a gold loan is 24 months for long-term loans serviced in EMIs and six months for short-term loans repaid in a lump sum. You can repay the loan in 24 instalments if you choose monthly payments. This means that the maximum gold loan term is 24 months. Even if you prefer shorter loan payback terms, such as 12 months, you can repay the loan before the term finishes. Banks do not charge prepayment penalties if you pay a minimum of three instalments and close the loan before the end of the term. If you choose a short gold loan term with a one-time payment, you will have a maximum repayment period of 6 months at a set interest rate. When your loan term ends in six months, you can repay the entire amount in one lump sum. Factors influencing gold loan applications Identity evidence, address proof, and recent passport-sized pictures are the most common types of documentation requested for a gold loan application. While this list remains consistent, many institutions have supplemental document lists for increased security. Because gold loans are evaluated based on the value of gold jewellery, financial institutions have a sanctioning limit. They can only make loans within that range. Greater limits are only permitted in exceptional circumstances where management agrees with the events and the borrower has a favourable repayment record. Financial institutions can grant a credit limit of up to 75% of the market value of the gold mortgaged in the case of a gold loan. The Reserve Bank of India caps the loan-to-value ratio in this scenario. When a borrower has fully repaid their loan, their gold loan eligibility requirement for reclaiming the same gold for future needs is positive. The most significant advantage of a gold loan is the flexibility to repay the principal and interest in numerous ways. They include a lump sum or equally distributed monthly gold loan payment alternatives, which are not accessible with other loan advances. Again, each NBFC has its loan gold loan payment options, and applicants must read the terms and circumstances before applying. [B-02] Conclusion Gold loans are great for emergencies, weddings, and personal emergencies since they are convenient and have a faster processing time. However, with fluctuating gold loans, any decline in the gold price may trigger the banks’ decision to sell the jewellery and repay the gold loan instead. However, the borrower might avoid this problem by repaying the bank the appropriate amount. To learn more about personal or gold loans, please visit https://www.piramalfinance.com/personal-loan.
08-11-2023
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Credit Score

What’s the difference between a CIBIL score and a CIBIL report?

While applying for a loan, you might come across terms like “CIBIL score” and “CIBIL report.” Terms like these often confuse you if you are new to the financial world. But what are these terms, and are they important? In the financial world, these two words have significant meaning and value. Without them, you cannot get a credit card or loan approval. You need to understand the meaning of and the difference between a CIBIL score and a CIBIL report so that the next time you are applying for a credit card or a loan, you will have enough knowledge of how these two work. [B-01] What is CIBIL? TransUnion CIBIL Limited, formerly known as Credit Information Bureau Ind Limited (CIBIL), is a credit rating agency or credit bureau that keeps track of all credit-related activity for businesses and individuals, including loans and credit cards. The bureau offers information and resources to help people understand their credit history and financial reputation and protect them against identity theft and potential fraud. The agency lets the lender know exactly how much the borrower can pay back and whether or not their money is safe. Read on to understand the difference between the CIBIL score and the CIBIL report. What is a CIBIL score? The teachers give their students scores according to their performance, be it monthly or yearly. In the same way, CIBIL acts as a teacher and gathers credit histories from banks and financial institutions. It then evaluates and assigns the CIBIL score to the specific borrower. A CIBIL score, or credit score, is a three-digit number that represents a borrower’s history and credit profile over a couple of months or years. The CIBIL score shows the borrower’s creditworthiness for borrowing a loan and making timely repayment. Through a credit score, lenders get a clear picture of the borrower’s credit performance, allowing them to decide if their money is in safe hands. The table shows how your CIBIL score increases or decreases your chance of getting a loan. CIBIL ScoreStatusChances of getting a loan.300-549PoorThere is no chance of loan approval.550-700FairFewer chances of loan approval.700-900GoodGood chances of loan approval.900-AboveExcellentInstant loan approval. What is a CIBIL report? A CIBIL Report, also known as a Credit Information Report (CIR), is a document containing a CIBIL score and an individual’s personal and credit-related information. Banks, financial institutions, and lenders provide credit information to credit bureaus to compile an accurate CIBIL credit report. The lender uses this report to determine the creditworthiness of the borrower. An individual’s CIBIL report may have the following: Personal details include name, gender, date of birth, PAN number, and permanent house address. Contact information such as email addresses, phone numbers, and landline numbers. Employment details like income. Account details, including the number of accounts, the types of loans borrowed, any loans paid off, any outstanding debts, credit card information, and credit card cancellations. Inquiries that lenders and banks make when someone applies for a credit product. CIBIL credit score (based on a person’s repayment history) and other credit-related information. Frequently Asked Questions. Q1. Are the CIBIL score and CIBIL report the same? The CIBIL score and CIBIL report are not the same. But both are interrelated. A CIBIL score is a three-digit number that represents an individual’s timely repayment capacity. A CIBIL report is an entire document containing a CIBIL score and an individual’s personal and credit-related details. Q2. What are the benefits of having a high CIBIL score? The following are the benefits of having a high CIBIL score: Faster loan and credit card approval. Lower loan interest rates. The better credit card offers. The higher credit limit on credit cards. Reduction in the processing fee and other costs associated with loan applications. Q3. What does CIBIL score 1 mean? A CIBIL score of 1 indicates that no credit history data is available for the borrower. This score is also known as “NH” or “no history” because there is no information to report. Q4. What is a bad CIBIL score? Scores on the CIBIL scale vary from 300 to 900. A credit score between 300 and 549 is considered poor. It means you have the slightest chance of loan approval. Q5. How can I get a 900 CIBIL score? The average time it takes to raise your CIBIL score is a few months. Make sure to pay your bills on time, maintain a healthy balance of secured and unsecured loans, and refrain from initiating too many credit inquiries in a short period to get your credit score closer to 900. [B-02] The bottom line Both the CIBIL score and the CIBIL report are not the same. But both are closely related. The CIBIL score shows the creditworthiness of an individual and gives the lender confidence in lending credit. In contrast, the CIBIL report contains the CIBIL score and an individual’s personal and credit-related details. Just as you would like your child to receive a good grade and report card at the end of each year, to maintain a good credit score, always pay your equated monthly instalments (EMIs) on time. Never opt for a loan beyond your repayment capacity, as this might lead to an outstanding debt. Call 1800 266 644 or apply for a loan right away.
08-11-2023
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FD

What Is The Difference Between Fixed Rate And Floating Rate?

Let us understand this concept through an example. Consider the following scenario: Since the beginning, Ravi and his family have been living in a rented home. When his father had to take a transfer because of his government job, the entire family had to relocate. All of Ravi’s schooling years and early life went like this; switching cities and homes. When Ravi was in the 11th standard, he often used to think of having his own home. The thought of having his own home someday motivated him to work hard and earn good money. He decided that someday he would buy his own house and make his parents proud. Fast forward 15 years, and Ravi is working and earning well in a private job. He is the vice president of sales in a big enterprise. Financially, he is now in a position where he can afford to buy a home for his family. However, he needs some clarification about taking a home loan. Should he take a loan at a fixed rate or should he go with a floating rate of interest? So he does what most people do in any confusing situation. He searches for information about the topic on the internet. When it comes to buying a house, many people, like Ravi, spend a lot of time deciding what would be best for them. Choosing a fixed rate or going with a floating rate. [B-01] Firstly, you should know that the interest rate is calculated based on two very important factors. These are: 1) The principal loan amount 2) The tenure of the home loan Now let us try and understand what a fixed interest rate is. What is a fixed rate? A fixed interest rate is simply an interest rate that any borrower would have to repay in fixed and equal amounts. The key feature of the fixed interest rate is that there are no fluctuations in it, irrespective of the market. This gives the borrower a sense of trust and certainty. Needless to say, this is a good choice for those who usually plan their budget in a practical and detailed manner. However, you won’t be able to get any advantage if the rate of interest decreases as per market conditions. You must pay those fixed monthly payments regardless. What is a floating rate? As the name suggests, a floating rate can and does change as per the market conditions. For a floating rate, you will need to pay a base amount while a floating element of interest is added to your loan. The “base rate” is simply the minimum interest rate that is set by the lender. It can be any financial institution, whether it be a bank or an NBFC. They are not allowed to lend below this base rate. And as and when the base rate changes, so does the floating rate. The major difference between the two is that the floating rate is usually cheaper than the fixed rate of interest. However, this is not always the case. Depending upon the market conditions, the floating rate can also overtake the fixed rate at times. Thus, the floating rate is not ideal for those who like to plan everything. Benefits of a Fixed Rate It remains constant. If you choose to go ahead with a fixed rate, you will not have to worry about the fluctuations happening in the market. Regardless of them, it remains constant. Your EMI amount will not change. While repaying the loan, you should pick the EMI amount that you are comfortable paying every month. That is to say, you will need to ensure that it doesn’t hamper your monthly budget. It helps you plan your budget accurately. One of the advantages of a fixed rate is that you can plan your finances in a detailed manner. This is because you don’t have to worry about the rate of interest fluctuating constantly. Now that we are aware of the benefits of fixed rates, let’s talk about the benefits of floating rates. Benefits of a floating interest rate The greatest benefit of a floating rate is that the interest rate is usually lower than the fixed rate of interest. The best part about opting for a floating rate is that if the economy performs well, you end up paying a lower interest amount. Thus, you can save a lot of your hard-earned money. The increased interest rate that you pay is temporary. Another advantage of a floating rate is that even though it may exceed the fixed rate of interest, that would be temporary. Because after a certain point in time, the interest rate gets lower as and when the economy stabilises. Fixed-rate vs. floating rate: What should you choose, keeping in mind the basic differences? If you opt for a fixed rate of interest for your home loan, then you will have to pay a fixed amount for the entire loan tenure. On the other hand, if you opt for a floating rate, then you will have to pay monthly instalments that would be lower than the fixed rate. However, in this case, the amount of EMI can change depending on how well the economy and markets are performing. [B-02] Conclusion Depending on your needs, you can pick whichever interest rate you find convenient. For those who want to play it safe, a fixed rate would be a better option. For those who don’t mind taking a little risk, the floating rate would be a good option. For more detail on financial topics, visit the Primal Finance website today.
08-11-2023
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Business Loan

What is the Length of Average Business Loan Terms

Most businesses, large or small, require finances to satisfy day-to-day business obligations. The nature of the business also determines the amount of funding needed: is it capital-intensive, and what stage of development is it in terms of genesis, growth, or maturity? Typically, firms require the most funding in their early phases and for future growth. Typically, business loan terms range from 12 months to five years. Short-term, or unsecured, loans have a tenure of fewer than five years, whereas long-term, or secured, loans have a length of 15 years or more. For start-up loans, the lender determines the payback term for a term loan at the time of the loan application. [B-01] Let’s find out in detail about the various business loans and their average term lengths below: Term Loans Term loans for businesses are loans for a set period. You can generally use these loans for capital projects such as purchasing new equipment and cars. They can also help upgrade an existing firm by installing computers or upgrading equipment. However, you should be aware of the hazards of taking these loans. Short-term, medium-term, and long-term business loans are available. These loans differ from other types of credit and funding in that they are made for a set period. In long-term loans, the borrower must provide collateral in exchange for the loan. You can repay short-term loans within five years or fewer. Long-term loans can have repayment terms of up to 15 years or more and may have lower interest rates than short-term loans. The borrower can also select fixed or variable interest rates when repaying the loan. Working Capital Loan These loans are intended to provide working capital for a company’s short-term operating needs rather than long-term assets or investments. Such essentials include payroll, rent, and debt payments. Working capital loans are thus simply corporate debt borrowings used by a company to fund its day-to-day operations. Working capital loans may be required by businesses with circular or seasonal sales to make it through periods of decreased business activity. They help buy raw materials when demand is high and pay for labour, rent, utilities, and other ongoing costs. You can repay working capital loans in as few as four months. You can of avail and repay these short-term loans as many times as you want, depending on the rise and fall of liquidity rates in your business. Machinery Loans These loans help you upgrade your business by purchasing the latest machinery and equipment or upgrading the existing ones. A qualified lender in India can provide you with a machinery loan with reasonable interest rates and a flexible payback period. The tenure usually varies from lender to lender but is between one and five years. Government Loans The Indian government has launched several credit schemes for individuals, MSMEs, women entrepreneurs, and other entities involved in the commerce, service, and manufacturing sectors. Loans under government schemes are provided by a variety of financial organizations, including private and public sector banks, non-bank financial companies (NBFCs), regional rural banks (RRBs), microfinance institutions (MFIs), small finance banks (SFBs), and others. Some of the most popular government loan programmes are: Mudra Scheme under PMMY: Length of term loan: 12 months to 5 years Standup India: The maximum term loan term is seven years PSB Loan in 59 Minutes: The maximum term loan length is one year MSME Loan Schemes from SIDBI: The maximum term loan length is ten years The minimum loan amount for all these government schemes is Rs. 10,000. They offer benefits to women entrepreneurs, rural businesses, and new businesses. You can obtain government bank loans for small enterprises by visiting the official website of the government-initiated schemes and applying online or with the bank that offers these schemes. Point of Sale (POS) Loans In a point-of-sale (POS) loan, the consumer pays for goods and services purchased from a specific store. Consumers complete a Point of Sale (POS) transaction when they buy goods from a store. After receiving payment, the merchant will provide its customers with a printed receipt for the transaction. As it relates to sales, customer management, inventory, stock, equipment, and employees, POS, often known as a retail management system, is a central component for enterprises. Almost every POS comprises software and hardware components that help shops manage their everyday operations. This sort of loan is also known as a merchant cash advance. The loan amount granted by banks and NBFCs is determined by the amount of business produced by POS terminals. [B-02] Conclusion The availability of a loan is an act of responsibility because the money must be returned. Various loan repayment opportunities are available today, each with its own set of terms and restrictions. These include delayed EMI payments, flexible repayment plans, step-up repayment plans, and loan foreclosure. Three efficient methods you can implement to pay your business loans on time are: When you have a savings account, you can utilise a standing instruction to withdraw whatever EMI you owe to them automatically. The lender can be informed of the date on which the EMI will be withdrawn. You must have cash in your account to ensure that any EMI isn’t missed and that the payback procedure is not interrupted. Post-dated cheques for the loan amount are provided to the lender, who will submit them to the bank on the designated date. It is similar to a standing instruction, but instead of withdrawing funds electronically, the cheque must be physically mailed to the borrower’s bank. If you do not have an account with your lending bank, you can use an electronic clearing service. The borrower will also authorise the lender to deduct the EMI from your account. Business owners must select a loan that meets their needs and guarantee that it is repaid on time. To apply for a competitive rate loan or understand more about business or personal loans, visit https://www.piramalfinance.com/personal-loan.
08-11-2023
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