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Personal Loan

Personal Loan for Pensioners: Eligibility, Document, Features

A young person with a solid salary might get a personal loan with ease and good terms in India. Yet, if you are above 65, you may find it harder. Retired people often struggle to keep up with debt paybacks due to a lack of constant income. As a result, most banks see them as a credit risk. They often issue loans with higher rates or even reject their request altogether. Yet, certain banks and financial firms provide loans to pensioners. To get credit, they must meet the criteria standards imposed by banks. This blog will go through the eligibility criteria, perks, features, papers needed, and application process for personal loans for pensioners. What is a Personal Loan for Pensioners? A personal loan for retirees is made especially for those over 60 who get a constant pension. The loan is versatile and may be used to meet various money demands. It is a collateral-free loan. No asset is secured here. Yet, a third-party guarantee may be needed for the loan to be approved. Although there is no major difference between personal loans to young people and personal loans for pensioners, the criteria and rates offered by lenders vary. Features & Perks of Personal Loans for Pensioners Here are some aspects and perks of a loan for retirees: Competitive Rates: This loan is available from many banking firms at a low rate, enabling you to plan and manage your finances in an organised manner. Minimal Paperwork: You can avoid the extensive and time taking paperwork by submitting your ID proof, home proof, and income evidence (details of your pension). No Security Needed: Personal loans for pensioners are unsecured. As a result, you do not need to present any collateral or security to receive it. You may borrow against your pension. Instant Approval & Rapid Payment: Your loan will be approved within a few hours, and the cash will instantly be put into your bank account. Multi-Purpose: There are no criteria for getting this loan from financial firms. As a result, it is one of the fast and cheap loans for retirees that can be used for many goals, such as trips and debt paybacks. Paperwork Needed to Apply for a Personal Loan For Pensioners For the lender to approve the loan request, you must complete a form and submit it together with the needed papers. Among these papers are the following: Identity verification You need a copy of your Aadhaar card, passport and driving licence. Include your PAN card and other ID proofs. Proof of residency Gather a copy of your rental agreement, property paperwork, and utility bills. Even Aadhar Card, Voter ID Card, and driving licence would work for proof of residency. Proof of Pension Bank records from the previous six months show that the pension has been credited to your account. Additional Papers This gives a clear idea of the financial state of the borrower. Lenders may ask for additional papers based on different factors. Eligibility Criteria for a Personal Loan for Pensioners Pensioners may get online and offline loans from lenders. But, before applying, you must be informed of the qualifying conditions to prevent rejection. You need to be a citizen of India. The maximum age for applying for this loan is 76. You should have worked for the govt. Or the military. In the case of your death, the relative pensioner (person authorised to receive the pension after you) may also apply for a personal loan. Yet, he or she should not be older than 76 years. Vital Factors to Consider To Get a Personal Loan for Pensioners Source of income People who get a pension from Central, State, or any other government-recognised agency may apply for the loan. Income from a previously employed private firm or a withdrawal from a late spouse or family member is also included. Note that personal loan rates are lower than those of other types of financing, such as credit cards. So, this loan is preferable to collecting credit card debt if you have a steady pension. Unsecured loans Personal loans for pensioners do not need collateral, which means you do not have to guarantee your home or a plot of land at the time of application. This is a significant perk since no assets would be kept as collateral. Duration of payback The time to repay the principal and interest on such a loan is similar to that of a standard loan. It may range from 12 to 60 months. But, the real payback term varies depending on the criteria and plans of the lender. The applicant’s equity and credit history are other vital factors in establishing the payback duration. Using an online personal loan EMI calculator, you can know your EMI and the loan length. Interest rates Personal loans for pensioners have variable rates. These are decided by the applicant’s age, credit score, and the lending firm’s rules. How Can You Seek a Personal Loan for Pensioners in India? You may always receive this credit facility by going to any bank offering retirees personal loans. All you have to do is complete the application form and submit it with all the needed papers. After verifying your papers, the officials will approve your loan request within two working days. You may also go to the bank’s website, sign in, and fill out the form. Provide and upload all needed papers. The bank will authorise and approve the loan within a few hours or days. They initiate the process after verifying your paperwork and information. [B-02] Conclusion One of the government’s key aims is to provide financial stability for the aged. For this reason, many pension plans have been developed. Each month, the pension is deposited into the person’s bank account. But, this pension is insufficient to meet sudden costs or additional expenses. Hence, the pensioner may need to hunt for money elsewhere to deal with unplanned events. All bank has created a lending plan in response to the demands of the elderly. Personal loans for pensioners have reduced rates and no paybacks or processing costs. A personal loan for retirees enables you to access cash when needed. Also, because the loan is flexible, you may use the cash for personal purposes and return the loan in constant EMIs. To learn more about personal loans for pensioners, visit Piramal Finance for related blogs and explore their products and services.

08-11-2023

Calculator

How Does a Bank Calculate Interest on Your Fixed Deposit?

A fixed deposit is a simple and safe investment. It only requires a one-time deposit. You can deposit a sum known as the “principal” with a bank for a set period. You will receive your deposit plus interest at the end. No matter how interest rates move, or how the economy performs, you will get fixed returns when investing. This helps you collect a large amount with ease. What is a fixed deposit? Banks offer fixed deposits (FDs), a type of investment product. In this type of investment, investors put in a fixed amount of capital at a fixed interest rate for a fixed period. When the fixed deposit matures, the bank returns the principal amount and the interest earned. Fixed deposits pay a higher interest rate than other products, such as savings accounts. You can put money into a fixed deposit for a period ranging from 7 days to 10 years. Anyone with a bank account can open an FD with a minimum deposit of Rs. 1,000. The minimum time frame is seven days. How does a Bank Calculate Fixed Deposit Interest? Bank Calculates Interest on Fixed Deposit: Simple and compound interest are the two methods for calculating interest on a fixed deposit. Banks may use either, depending on the deposit’s tenure and size. Simple Interest - This method is simple. It is computed by multiplying the principal, interest rate, and period. “principal x rate of interest x time period divided by 100” or “P x Rx T/100.” Where, P = principal amount; R = annual interest rate T is the number of periods. For example, if you invest Rs. 10,000 at 8% p.a. for 5 years, the interest can be calculated as follows: Step 1: 10,000 times 8 times 5 equals Rs. 4,000,000. Step 2: Divide that number by 100. You will be paid Rs. 4,000. So, after 5 years, you will have earned Rs. 4,000 in interest. As a result, if you invest Rs. 10,000 in a fixed deposit paying 8% p.a. simple interest over 5 years, you will receive Rs. 14,000 back. Compound Interest - In this method, you earn interest on both the principal and the interest. Many banks offer compound to calculate interest on fixed deposits, but you should shop around to ensure you get a good rate. For example, suppose a bank offers 8% p.a. on a 5-year deposit with annual compounding. So, if you invest Rs. 10,000, the interest can be calculated as follows: In the first year, we employ the simple interest method. 10,000x8x1/100 = Rs.800 So, the first year’s interest is Rs. 800. This sum is returned to the principal. As a result, the second-year principal’s salary is Rs. 10,800. We can now compute the compound interest for the next three years in this manner. Calculate Interest Fixed Deposits Using the fixed deposit calculator While the formulas are direct and can be used by banks to calculate the fixed deposit yield interest rate, they are technical calculations. As a result, fixed deposit calculators are available to assist you in correctly and easily calculating the possible interest. The fixed deposit calculator is an online tool. You must enter the deposit amount, the deposit tenure, and the interest rate. The calculator then calculates the interest rate on the deposit and the amount due at maturity. You can also adjust the deposit amount to see how the interest earnings change. The formula for calculating the final amount using a compound interest rate is as follows: A=P [1+(r/12)/100)] N Where: The amount at the end of the investing period is denoted by A. P is the initial investment amount. R: annualised interest rate, for example, 6, 6.5, or 7. N: Is the investment tenure Conclusion A fixed deposit is an investment scheme. You deposit a lump-sum amount with a bank or financial institution for a specific period. As a reward for this lump sum, you will receive a certain percentage of interest. At the end of the fixed period, the financial institution returns your principal investment amount and the interest earned up to that point. Fixed deposits are generally considered far safer than other types of investments. Fixed deposits have low default risk. However, the default risk is not non-existent. You risk losing your investment capital if you invest in low-rated fixed deposits. [B-02] FAQs What is the definition of compound interest? What is the compound interest formula for a fixed deposit? Fixed-Deposit Compound Interest Compound interest is interest earned on both the principal and interest earned. The interest rate is increased in proportion to the number of periods (years) for which the interest will be compounded and multiplied by the principal amount invested. Calculate interest on FD using compound interest P (1 + r/n) (n * t) A “A stands for maturity amount. P denotes the principal invested. R = The interest rate (in decimals) N is the number of compounds that occur in a year. T denotes the number of years. What is the minimum term for which a fixed deposit can be held? Customers can invest their money for as little as 7 days and as much as 10 years. What are the drawbacks of a fixed deposit? Fixed deposits have drawbacks.Lower interest rates No interest increasesInflation can cause interest rates to fall.

08-11-2023

Personal Loan

Personal Loan Prepayment Calculator Benefits and Steps to Use

The value of EMI is fixed at the time of buying. It is paid every month. This is to ease the burden on the borrower. You can, however, pay off loans ahead of schedule. This is a prepayment of loans. We can also call it “payment in advance.” People use this to pay on time. It can be useful in many ways. Its amount can be calculated using a personal loan prepayment calculator. Let’s discuss this in detail. When people pay EMI, they pay interest. There is a fixed interest to be paid. It has to give every month with EMI. But sometimes, people want to ease the problems. If they have lump sum money, they can use it. It can be used to repay the loan amount. It can reduce the total amount. In turn, it reduces interest. So, the prepayment of loans minimises the burden on people. The amount for prepayment is calculated before paying. It is done by using a personal loan prepayment calculator. It is effortless to use. [B-01] Steps To Use A Personal Loan Prepayment Calculator Using the personal loan prepayment calculator is easy. Follow these simple steps: Enter the principal loan amount. Enter the current rate of interest. Mention the original term of the loan. Verify the number of EMIs paid. You will see the amount that is due. Enter the prepayment amount. Click OK. The screen will display the amount paid. It will also mention the amount left. The period and EMI will change. The new period and EMI will be visible on the screen. In the prepayment of loans, different cases can arise. These includes Case 1: Full prepayment This is for the people who want to pay the amount completely. It includes paying every penny left. It is called foreclosure. You can do it if you become eligible to pay the entire amount. It saves you from interest. This method saves a lot of money. But it requires paying a lump sum all at once. A specific amount is paid in this. That amount is called the foreclosure amount. Case 2: Partial prepayment once It means paying a partial lump sum at once. It shortens the repayment period by lowering the principal amount. And less interest to be paid. This amount can be calculated using a personal loan prepayment calculator. It is effortless to use. Fill in all the blanks. Get a new loan period and EMI. The EMI can also be varied. This helps people in many ways. It can reduce the burden of EMI as the remaining balance is reduced. Case 3: Partial monthly prepayment It means paying in advance every month. It also reduces the overall period of the loan. This amount can also be calculated using a prepayment calculator. The user can decide the extra amount to be paid. All the values are to be put in the prepayment calculator. A new EMI is generated. It is user-friendly and easy to use. People can use it if they want to increase their monthly repayment. This helps them pay off loans on time. Above, we discussed three cases regarding repayment. The amount for all three is differently calculated. A personal loan prepayment calculator can easily calculate it. This calculator is beneficial and easy to use. Anyone can easily use it for calculations. The only work to be done is to input the correct values. All analyses are carried out by the calculator. There is no chance of error. Piramal Finance offers ZERO charges on Personal Loan Pre Payment. Benefits Of Using A Personal Loan Prepayment Calculator There are many benefits to using a personal loan prepayment calculator. Some of these are: Easy to Use: This calculator is easy to use. No special knowledge is required. Anyone with little financial knowledge can easily use it. Also, no special work is to be done. The only task at hand is to assign values. Even a kid can operate it. It is readily available online. There is no need for offline work. No Errors: The calculations on this calculator have no errors. Since it is software, there is no chance of error in the calculations. This can make your work easy. It can provide you with error-free results. This can also help with proper planning. This can help people save time. Lesser Interest: Prepaying loans has a lot of benefits. Reduced interest tops the list. The prepayment of the amount reduces the principal amount. This, in turn, reduces interest. It saves money. Interest is a burden on people. Prepaying loans can reduce it. Interest adds up to increase the principal amount. The amount to be paid back is much more than the loan taken. It is paid in EMI, but it’s still tricky. However, prepaying reduces the burden. A personal loan prepayment calculator can calculate this amount. It also shows detailed values for interest and period. Hence, it is advantageous. Time Management: The personal loan prepayment calculator can help manage time. Prepaying loans reduces the overall period. This requires planning. You can be free of debt easily. You can calculate the prepayment amount according to your comfort. It is an easy process. It does not require offline work. You can do it yourself. In turn, this saves a lot of time. Also, when you are free from debt early, you can focus on other things. Practical Approach to Life: This can give someone a practical approach to life. A definite amount can motivate you to save money. You can plan for the future. Keeping in mind the occasions, the prepayment amount can be changed. You can make partial prepayments. [B-02] CONCLUSION Using a personal loan prepayment calculator is very easy. Prepaying your loans also has a lot of benefits. It is easy and friendly. This can reduce the burden on people and help them understand time management.

08-11-2023

Personal Loan

What Are the Steps to Calculating a Car Loan?

The cost of borrowing money to buy a car is referred to as auto loan interest or Car Loan interest. The lender will base its interest rate on your credit score, debt-to-income ratio, and other factors. To create your budget, you should know your interest rate and how much money goes toward your monthly loan balance. Car Loan EMI includes the principal and interest payments on your car loan. The amount, rate of interest, and period primarily determine the EMI. The longer the period, the lower the EMI, but you will pay more interest to your lender. [B-01] What Do Auto Loan Calculation Formulas Include? The key factors in the calculator for a car loan are the interest rate, loan size, and loan term. A larger loan will result in a higher monthly payment. A smaller loan will result in lower payments. Higher interest rates result in higher monthly payments than lower interest rates. A loan with a shorter term will have a higher monthly payment than a loan with a longer term. When looking for the right loan for your monthly budget, you can adjust these three factors to find the best balance for your needs. Car Loan EMI Calculation Methods You can calculate the EMIs on your car loan in two ways: online or manually. Method 1: Using an Online EMI Calculator for Car Loans Visit the lending institution’s car loan EMI calculator page. The monthly EMI you must pay will be displayed instantly after entering the information mentioned above. Method number 2: Use a manual EMI Calculator for Car Loans This is the formula for a calculator for a car loan: E = [(1 + R) N – 1] [(P x R x (1+ R) N)] where E denotes Equated Monthly Instalment, P is the principal loan amount, R is the interest rate, and N the number of months These three variables are changeable. This means that the EMI value will change whenever one of the three variables is changed. The following are the five advantages of using an EMI calculator for a car loan : Simple to use Quick results It saves time and energy that would have been spent on manual calculations. It assists you in determining how much your car loan EMI will be. Advantages of a Car Loan Flexibility in choosing a tenure Car loans are available for terms of up to seven years. This gives you the freedom to plan your finances and the convenience of choosing the tenure of your choice. Secured Loan Because a car loan is a secured loan, you are not required to mortgage your existing assets (secured against the car itself). Meaning until the loan is fully repaid, the lending institution or bank has a lien on the asset, giving it the authority to seize the asset and recover the debt by selling the vehicle. Loan Payment Options You can pay with post-dated checks or by auto-debit. Your EMI will be deducted automatically from your bank account. This will be when you use the auto-debit feature. Conclusion A car loan is a type of credit product offered by banks and other lenders. It allows you to finance the purchase of a car with a low down payment. The loan can be repaid in EMIs over time at an agreed-upon interest rate. Before applying for a loan, the car loan EMI must be calculated. A car loan calculator can assist you in calculating the EMI and interest payable on a financed vehicle. India is now the world’s fourth-largest market for four-wheelers. The figure demonstrates how car demand has risen over time. Many people desire a personal car, but the cost impedes purchase. A car loan can help you pay a low down payment and easily get your dream car. The remaining balance can be paid monthly at an agreed-upon interest rate. Dive into Piramal Finance articles for more such finance-related subjects here: [B-02] FAQs What If I Can’t Pay My Car Loan EMI? When taking out a loan, make sure you can repay it. Failure to do so will result in substantial fines from the lender. Your credit score will also suffer as a result. Suppose you are unable to repay the loan due to unforeseeable circumstances. In that case, you must notify the lender as soon as possible so options such as moratoria or a longer repayment period can be considered. What Is The Required Down Payment On A Car? Generally, the minimum down payment for a car loan is 10% of the car’s on-road price. This is because most lenders offer 90%, if not 100%, of the vehicle’s on-road price. However, if you make a substantial down payment, you will require a lower loan amount. Your monthly EMIs and interest rate will also be low. What factors influence your car loan EMI? Loan amount Interest rate Loan tenure Rest period once a month What exactly is EMI? The Equated Monthly Instalment (or EMI) is made up of the loan principal and interest. As a result, the EMI equals the principal amount plus the interest paid on the car loan. The EMI is usually fixed for the entire loan term and is repaid.

08-11-2023

Personal Loan

Popular personal loan myths you should ignore

Personal loans are very popular. They can be used for anything you want, such as financing a wedding, paying for college, dealing with medical emergencies, or paying off other debts. They are simple to get. The quick disbursement makes the entire process easy and painless. The popularity and advantages of instant personal loans are well known. However, some personal loan myths persist, and these common myths can be misleading. Read below for some common personal loan myths to avoid Personal loans are only used for personal reasons This common misconception causes people to avoid applying for personal loans. Most people believe personal loans are only for personal use because of their name. A personal loan can be used for almost any purpose, including medical emergencies, home renovations, child education, vacations, debt consolidation, and weddings. A low credit score equals loan denial Borrowers believe that a low credit score will result in their personal loan application being canceled. While your credit score is an important factor considered during personal loan eligibility evaluation, it is not the only criterion. Lenders also consider your income and loan repayment capacity. Only employees on a salary are eligible It’s a misconception that you can only apply for a personal loan if you have your pay stubs, offer letter, and company ID. Personal loans are available to self-employed people, private business owners, and NRIs. Indeed, some lending institutions make personal loans based on home rent income. You are ineligible due to a low credit score A low credit score reduces your eligibility for a personal loan. But it does not negate your chances of getting one. Some firms are willing to make loans to people with poor credit. If you take out a personal loan, you will also have a good chance of paying off your other debts. You improve your credit score when you repay your personal loan nicely and on time. The most expensive loans are personal loans This is one of the most common reasons people avoid taking out personal loans. A personal loan’s average interest rate (12%–16% per year) is lower than that of a credit card (2.5%–3% per month). Most people use their credit cards in an emergency. Now, it is simple to get a personal loan. When you need money, it is best to get a personal loan. You could also use seasonal offers and personal loan schemes. There are no tax breaks This is one of the most common Personal Loan Myths that prevent people from taking out a personal loan. Please keep in mind that a personal loan does not count as income. You can claim certain tax benefits when you use a personal loan for property construction or repair. You can also use the money for a down payment on a home and still claim tax benefits. The lengthy approval process You may have heard that applying for a personal loan entails a time-consuming application process. Also, there is extensive documentation, frequent bank visits, and so on. But this is a common misconception. On the other hand, personal loans can now be secured online, saving you time and effort. Quick personal loans are given by online lenders using cutting-edge technology. A personal loan requires the least amount of documentation. The lender sends a representative to your door to complete the documentation process. The loan is agreed upon in minutes; you can have it in your hands in less than three days. You can finish the entire procedure without leaving your house. Personal loans are only available from large banks or non-bank financial institutions. You've got it wrong if you believe personal loans are only available from top banks or NBFCs (non-banking financial companies). Smaller banks and other lending firms offer personal loans with lower interest rates. You cannot apply for a personal loan if you already have one. No rule says you can’t apply for a personal loan if you already have one. Lending firms check your repayment capacity when approving your loan. If various loans burden you, you can use the debt consolidation facility to combine many debts into one. Your personal loan application may be approved even if you have an existing loan as long as your repayment capacity is satisfactory to the lender. My loan is detrimental to my financial health Increasing your debt burden may not seem like a good idea if you already have many loans or are paying high interest rates. However, the notion that your financial stability fixes a personal loan is untrue. A personal loan can reduce your interest payment. Conclusion Personal loan myths already exist in our world. We cannot avoid them. But we can control how they are used. This means verifying before believing and moving forward after validating. If you want to apply for a personal loan but aren’t sure, contact the lending company; they’ll talk to you about it. Not a member of your family, a friend, or a co-worker. Clear your mind of any ambiguous thoughts. [B-02] FAQs Is it possible to close a personal loan in advance? Some banks have a 6-month to a 1-year lock-in period. While others allow you to pre-close your account even after the first EMI has been deducted. There may also be restrictions, such as using only your funds to pre-close a loan. Banks may provide free pre-closure or charge a fee. Please ask the bank’s loan advisor to clarify all these factors before signing the loan document. What loan terms do I have? The length would be fixed by your earnings and experience and could range from 12 to 60 months. Is it possible to track a loan application? Yes, you can choose this option. The facts will be shared via phone messages or emails, and it is also free.

08-11-2023

Business Loan

Collateral Free Business Loan for Traders

Traders bridge the gap between the manufacturer and the consumer. You’ve come to the right place if you need urgent cash with no collateral. Many banks and NBFCs provide collateral-free loans. Due to a lack of adequate funds, you may feel obligated as a business owner to tap into your own personal funds. You could also try to find a business loan. But, the prospect of having to pledge collateral may cause you to hesitate. This leads us to an important question. What exactly is collateral, and how does one get a Collateral-Free Loan? A collateral is an asset given to a lender by a borrower to secure a loan. When a borrower fails to make a loan payment, the financial firms that issued the loan have the right to seize the collateral. This is to recover any sustained losses. A business loan is a type of financial product that is only used for business purposes. Business owners and self-employed professionals can apply. Along with MSMEs (Ministry of Micro, Small & Medium Enterprises), others can also apply for bank loans. The loan proceeds are used for business expansion. It can be like meeting working capital needs, increasing cash flow, etc. Working capital loans, term loans, cash credit, and letters of credit are available. Loans under government schemes and bank guarantees are also available from financial firms. Loans for businesses without collateral are collateral-free loans. These are business loans with no collateral. Collateral-free business loans are simple to secure and provide borrowers with limitless opportunities. They not only assist us in meeting our firm’s objectives but also in meeting the needs of our customers. The loan amount and repayment period may exceed the needs of the business. Banks offer interest rates based on financial stability. They also consider credit history, repayment ability, firm tenure, and other factors. Trader Loan Eligibility Criteria for Collateral Free Business Loan The following are the eligibility requirements for a Collateral Free Business Loan : The applicant must be self-employed and work in the trading industry. The applicant must have at least 5 years of business experience. The applicant must be an Indian national of at least 22. The applicant must have at least an annual revenue of Rs. 10 lakh. A CIBIL score of 750 or higher is important. Lenders’ credit score needs can differ. The applicant must have an annual income of 2 lakh. The person must have operated a profitable business for at least two years. Features and Benefits of Trader for Collateral-Free Business Loan The following are some of the features and benefits of firm loans for traders: Collateral-free: Traders' loans can be secured without collateral. This means borrowers do not have to go through a lengthy application process to get credit. However, traders should remember that these loans do not have security or collateral. Hence, the interest rate will be higher. Flexible repayment terms: Traders can repay their Collateral-Free Business Loan over 36 months, and some lending firms may allow traders to repay their debts over 60 months. Quick and Easy Process: One can apply for a Collateral Free Business Loan online through financial markets. This means that a trader can apply for a business loan quickly. Most traders need them on an urgent basis. Minimal paperwork: Collateral Free Business Loans for traders can be acquired with few records. Applicants must share their personal and professional data, adequate identity, and proof of income when applying. The applicant will only need to share a few facts. The process of applying for a trader loan will not take long. Quick Approval and Disbursement: The lender has verified the data submitted with the trader loan application. The funds will be deposited into the applicant’s account as soon as possible. Collateral Free Business Loan funds are disbursed within three days of approval. Conclusion Traders are important links between consumers and manufacturers of goods. Companies or individuals who buy and sell goods can qualify for a collateral-free business loan. Trade loans help a firm by funding trade throughout its trading cycle. It is a loan with no collateral. Collateral-free loans are unsecured, so you can repay your loan on time. It considers your current income, cash flows, and the firm’s viability. [B-02] FAQs What documents are needed for a Collateral Free Business loan? When applying for a business loan, the following documents must be there : KYC Documents Application form filled out and signed by the customer Relevant financial records Bank account statement for the previous six months PAN card Business Evidence How much money can you get through Collateral Free Business Loans? An unsecured business loan of up to 1 crore can be secured. How much time does it take to get a business loan? It usually takes 48 to 72 hours for a firm loan to be disbursed into your account. What is the least loan amount for a collateral-free loan? The Coverage of Collateral Free Loans (CGTMSE) aims to provide collateral-free loans up to Rs. 200 lakhs (up to Rs. 100 lakhs for retail and wholesale trade) to Micro and Small Enterprises as defined by the MSMED Act of 2006.

08-11-2023

Personal Loan

How To Get An Instant Personal Loan Online In India

The way you bank these days is quickly changing. The process is becoming less paper-intensive and more timely. With the ever-increasing need for instant cash for medical crises, acquiring a vital asset, wedding or trip expenditures, automobile or house repair bills, or any unforeseen incident, the demand for rapid online loans is also expanding. Due to the fast application process and rapid processing period, an online instant personal loan is becoming more popular. [B-01] What is an Instant Personal Loan? Instant personal loans are unsecured loans made available by many banks and NBFCs with rapid approval, payout, and little to no paperwork. These loans are granted quickly without any collateral. Many lenders provide instant personal loans online in current times. Depending on your credit history, lenders often provide pre-approved loans to a specific group of current clients. As these loans are pre-approved, many lenders may provide them without additional paperwork. Features of an Online Instant Personal Loan Here are the features of an online instant personal loan: No Collateral Required These personal loans are unsecured. Thus, if you apply for an instant loan, you won’t need to provide any security. Quick Payment Applying for an instant loan is advised if you want money faster. Once your form is accepted, the cash will be sent to your account within no time. Quick Process Instant loans process far faster than traditional loans by a considerable margin. Flexible Loan Terms You are often given a flexible loan term when you apply for an instant loan. So long as you stay within the maximum loan payback time set by the lender, you may pick a payback period that suits your needs. Papers Needed for an Instant Personal Loan Online Application The papers required to apply for an instant personal loan online are listed below. Identity Proof: You must provide an Aadhar card, PAN card, driving license, or passport as proof. Address Proof: This includes utility bills such as energy, water, phone, or your passport. Photo Proof: A passport-size photo of you. Salary Slips: The most recent pay stubs from your workplace are necessary. Bank Statements: You must produce salary credited bank statements. Eligibility Requirements For an Online Instant Personal Loan You must fulfil the lender’s eligibility needs to get your loan form accepted. The following are the standard qualifying rules for applying for an instant loan: Credit Rating: To be eligible for an instant loan with a low rate, you must have a decent credit score. A credit rating of at least 750 is needed. Age All borrowers must fulfil the lender’s age limits. The age restrictions may differ depending on whether you are a paid employee or a self-employed person. Check the age criteria of banks/money firms that provide instant loans. Occupation Summary Most lenders provide instant personal loans to both salaried and self-employed people. How to Apply For An Instant Personal Loan Online Determine your eligibility and choose a personal loan plan Fill out a few simple pieces of data to see whether you qualify for fast loans and a credit line. A credit line is the maximum amount of money you may borrow from a lender. You may pick the loan amount after you have received your credit line to pick your loan plan and choose the optimal combination of loan lengths and EMIs. Upload your KYC papers You must attach a few papers to complete your KYC and have your loan approved. You must also sign the loan agreement and a NACH form to activate the EMI auto deduction. NACH, which stands for National Automated Clearing House, is a centralized web-based payment system for bulk money deals controlled and monitored by the Reserve Bank of India (RBI). The NACH form guarantees that you stay caught up on your EMI payments. The best part is that the whole thing is paperless. After uploading all the needed papers, you will get approval within two hours. Complete the process After the loan is confirmed and the application process is completed, the funds will be sent instantly to your bank account. Tips Before Taking An Instant Personal Loan Online Before you apply for an instant personal loan online, you should compare the loans provided by many lenders. When analyzing instant loans, you should keep an eye on the following factors: Processing Fee Most money firms and banks often charge users a one-time service fee. You will have to pay extra for your loan if you are charged a hefty processing fee. Default Penalty The lender may impose a default penalty if you do not pay your EMIs on time. As a result, it is vital to compare the default costs imposed by many lenders. Rate of Interest The interest rate imposed by a lender might impact the total cost of the loan. As a result, before going to a specific lender, check the rate at which the loan is given. Pay Back Flexibility Choosing an instant loan allows you to make or before or part payments towards your loan balance. This is particularly if you want to pay it off before the end of the loan’s term. Loan Amount When comparing instant loan offers from many lenders, analyze the amount given. For example, if you want an instant personal loan online for Rs. 15 lakhs, you should only look at lenders that enable users to borrow up to Rs. 15 lakh. [B-02] Conclusion The banking industry has seen many developments in recent years. This includes an instant loan. This loan represents a vital change. Since the beginning of banking, applying for a personal loan has been a laborious process filled with worry, strain, and time waste. For these reasons, it was critical to establish a new kind of loan tool that would be simpler for people to obtain.

08-11-2023

Personal Loan

How to Calculate Personal Loan EMI in Excel

More and more individuals are turning to personal loans as a primary source of credit. People get these types of loans to cover unexpected expenses. They can be either short-term or medium-term. Personal loans are available without requiring collateral, but this will depend on your creditworthiness, earnings, age, and other variables. Personal loans offer attractive interest rates to borrowers. Plus, you can complete the paperwork procedure online for speedy loan disbursement. So, without further ado, let’s jump right into it! [B-01] How to Calculate Loan EMI Using Excel Once you are familiar with the formula, determining your EMI payments in Excel is quite simple. In addition, you can use free tools like EMI calculators present on the websites of most lending banks. In these, you can enter essential details like the loan balance, the rate of interest, and the time to repay the loan and immediately get the EMI amount you need to pay. Calculating your personal loan EMI using Microsoft Excel is very simple. For this, Excel offers a handy formula: PMT (rate, nper, pv, [fv], [type]). PMT is short for “payment,” and the value it generates is the monthly instalment payment on a loan. This function requires the following parameters: rate – The loan’s annual percentage rate of interest nper – The number of loan payments pv = current loan balance or outstanding loan amount fv – The money you hope to have on hand once you complete the final payment or its future worth. Its default value is the loan amount that remains unpaid after you’ve repaid all the loans. For this function to work, rate and nper must be of the same units. For example, to calculate monthly EMI, use the monthly interest rate rather than the yearly one. Take a look to see what we mean: Think about you’re taking out a loan of 20 lakh rupees at an interest rate of 12 percent per year for 25 years. If paid back in three equal quarterly payments: Rate = 12%/4 per quarter Npr = 25X4 EMI calculation in excel will be: = PMT(12%/4, 25*4, 20,00,000) How to Calculate Personal Loan EMI Using Mathematical Formula? No worries if you don’t have Microsoft Excel. You can still determine the EMI using a calculator or basic arithmetic skills. The formula often used to determine the EMI amount is: EMI = [P x R x (1+R)^N] /[(1+R)^N-1] In this equation, P is the debt principle R is the rate of interest each year N represents the number of payments during the life of the loan. For the EMI formula to work as expected, the rate units and EMI period must be identical, as they are in the PMT formula. So, suppose the interest rate payable is 10% per year, and you need to figure out your EMI. In that case, you would put [10/(12X100)] into the calculation for R. The PMT function derives its output from the same underlying computation as the EMI. Hence, the two are interchangeable. Remember that these figures assume a fixed interest rate throughout the loan’s term. Also, the results don’t account for any costs other than the principal amount and interest. How to Calculate Personal Loan EMI Using Online Calculators? Most financial institutions and banking organizations calculate personal loan EMI using a formula. You can also use a Personal Loan EMI Calculator to estimate your EMI. Your EMI will depend on the total amount you borrow, length of time, and interest rate. 3 Facts You Should Know About Personal Loan EMI Calculation 1. Your EMI payment factors in interest accrued on that principal. You’re doing two things when you pay your EMI: repaying the principal and the interest. You repay the loan over the loan’s term by making equal monthly payments, or EMIs. Suppose you first begin making EMI repayments. Then, the amount you send toward interest is more than the amount you give toward the principal. In contrast, your EMIs will go more toward repaying the loan’s principle than interest. 2. Make sure the monthly EMI payment doesn’t exceed 40% of your take-home pay. Suppose you’re considering taking out a loan. Whether a car loan or a home loan, your monthly EMI payments shouldn’t exceed 40% of your gross monthly income. That’s because most individuals only have a certain amount of money to pay bills. Whether you’re an entrepreneur or an employee, your money is always subject to market risk. Thus, it is advisable to play it safe and ensure that your EMI expenses are at most 40% of your earnings. 3. Your interest rate will fluctuate based on several variables. The interest rate charged on your personal loan is a major component in determining your EMI. Income, credit score, loan amount, and age, all play a role in determining the interest rate. But, variables like your credit history influence the sum. Loan and credit card payments, both old and new, impact your credit score. Lenders see customers with a history of making timely payments on loans and bills as low risk. Hence, they offer such customers more favourable terms on personal loans. [B-02] Conclusion Be clever when figuring out your personal loan EMI. You can do this by considering how this will affect your spending plans. Consistent expenses will significantly impact your ability to repay your loan. Did you love this article? Follow our blog for more investing, personal finance, and banking tips!

08-11-2023

Personal Loan

What is FOIR and How is It Calculated On a Personal Loan?

A personal loan is one of the most common loans applied by people. It is an unsecured loan with quick disbursal. The documentation needs are quite basic. The eligibility for a personal loan is simple. It is based on your age, income, and credit score. But there is one thing known as FOIR, which is also considered. Understanding FOIR and the right way to calculate it is important. This guide will share with you complete insights on the same. [B-01] Understanding FOIR FOIR is a fixed obligation-to-income ratio. It is a parameter which is used to check loan eligibility. It determines the creditworthiness of the applicant. In simple terms, it is the debt-to-income ratio. This ratio is always represented in percentages. This display the percentage of the debt you have against your income. It is a true reflection of your credit health and repayment eligibility. It shows your actual repayment capacity at the income you are earning. Mathematically, it is: FOIR = (Sum of all monthly debts/ Net income per month) * 100 For simple understanding, here are the details of each term: Debts are the total of EMIs and other credit bills you must pay. It includes EMI for personal loans, home loans, business loans, education loans, and others. Net income is the total amount you earn from all sources. You can also have multiple sources of income. You just need to back up them with evidence. Every lender has their own accepted FOIR range. But in general, it should be between 40% to 55%. To understand the FOIR calculator, let us take an example: Example of FOIR calculation Suppose you earn a monthly salary of INR 90,000. The following are the EMIs he needs to pay: Home loan = INR 25,000 PM Auto loan = INR 15,000 PM Mortgage loan = INR 20,000 PM Credit card instalment = INR 8,000 PM The total amount you need to pay per month is INR 68,000. Now, the FOIR is = (68,000/90,000)*100 = 75.56%. The ratio can be explained as follows: 75.56% of your income goes into debt. Your surplus is only 24.44% to pay any new debt. Now, this is out of range which will reject the loan application. Significance of Low and High FOIR A low FOIR signifies: You have fewer liabilities. Your disposable income is high. The chances of repaying the debt are high. The chances of loan approval are high. A high FOIR signifies: You have more debts. You do not have a high disposable income. There are chances of delayed payment or non-repayment of debt. The chances of loan rejection are high. Tips to improve your FOIR Improving FOIR is the best way to get approval for your loans. These tips can help you: Go for a joint loan If you have a high need for a loan, try a joint loan. The co-applicant be your spouse or a blood relative. This will reduce the burden of EMI on you. Also, this will improve your FOIR and improve your chances of loan approval. Repay your debts You need to repay your debts on time for a healthy credit score. It will help to improve your credit score and FOIR. As you repay debt, the amount for EMI will reduce over time. Also, this will allow you to get a new loan if needed. Improve credit utilisation ratio It is the ratio of the credit used against the credit available. It is suggested to keep it well below 30%. If your credit utilisation ratio is above 30%, consider paying off some debts. This will increase your disposable income with you. Also, it will improve your FOIR. Avoid multiple loans You should avoid multiple loans. Lenders prefer borrowers who can manage their finances well. Too many loans in your profile can lead to the rejection of your application. Avoid frequent job switches Frequent job switches are also a cause of high FOIR and so can lead to application rejection. You will not have a consistent income due to gaps in between. This will further worsen your disposable income. Increase in loan tenure You can increase the loan tenure for existing loans. In that case, it will reduce your EMIs and increase your disposable income. This will give you a chance to get your loan application approved. Include additional income, if any You should disclose all the sources of income you have. Ensure you have proof of income to support. Additional income will raise your total income and reduce FOIR. Why is FOIR so important for a personal loan? A personal loan is an unsecured loan. There is no collateral associated with it. When you apply, the lender needs to ensure you have a sufficient amount to pay off the debt. Calculating FOIR will ensure the lender that you have enough surplus to pay off the EMI. This is a sign that your application will be approved. A FOIR is important for both the lender and the borrower. It gives a lender an idea of the credit health of the borrower. On the contrary, it offers the borrower an idea of his monthly expenses. A high FOIR can increase the interest rate, while a low FOIR might attract a lower interest rate. The lender might assess your assets and prefer a secured loan against a personal loan. This will ensure them of the repayment. Reason to consider a personal loan You can use a personal loan for multiple purposes. The application for a personal loan is simple. It is unsecured. The eligibility criteria are straightforward. The documentation needs are quite straightforward. You can apply a personal loan for online. You can visit the lender’s website. Fill in the form and apply. There is no need for any collateral. The processing fees and interest rates are better. [B-02] Conclusion Multiple factors impact a personal loan. Analysing each factor ensures the lender of your credibility. FOIR is one of them. It allows a lender to check the surplus income you have. This will define your actual debt against your total income. A low FOIR is a sign of better credit management. This will increase the chances of approval of your loan. But if you have a high FOIR, your application might be rejected. You must follow the right financial management to reduce your FOIR. You might have some fixed obligations, but you can manage FOIR by managing your credit utilisation ratio. You can visit Piramal Finance to apply for a personal loan and get information about FOIR. The process of application is quite simple and online. Also, you can easily meet all your financial needs with the amount.

08-11-2023