Personal Loan

The Pro Guide about Personal Loan Disbursement


Are you considering taking a personal loan? A personal loan can help you in many ways. It does not require assets and heavy documentation. You may have heard that it is quick compared to other loans. A personal loan will come in handy in emergencies. However, you must learn as much as possible about how personal loans are paid out.

What is the process for availing of a personal loan? How long will it take for the loan to be paid out by the lender? Read on to learn more about the personal loan disbursement process.

What Is Personal Loan Disbursement?

It is the process by which nonbank financial companies (NBFCs) or banks send the loan amount to the borrower’s bank account. When you receive this amount in your bank account, you can use it for anything you require.

After you have submitted the loan application, you will receive the money in 7 to 10 business days. The number of days taken for loan disbursement may vary based on the lender and how long it takes them to do their due diligence.

Applying for a Personal Loan

The first step is to fill out a loan application online through a bank, NBFC, or branch office. Fill out the loan application form with the information required.

You will need to provide proof of identity, bills, and income tax returns (ITRs) along with your loan application. The banks or NBFC may ask for more proof depending on their rules and regulations.

Documents Required for Personal Loan

You must submit document proofs and the application form. All the paperwork will be verified and updated.

The following is a list that serves as a general guide. The documentation requirements may vary from lender to lender:

  • Identification proof
  • Proof of address
  • Income evidence
  • Bank details
  • Financial Statement (ITR)
  • Two passport-size photos

Approval of Personal Loan

The lender will start the approval process once the loan application and other paperwork have been submitted. The lender may take some time to approve the loan.

Any errors or discrepancies in the form or documents will delay the process. Proper documentation will help the lender process the loan faster.

Amount of Personal Loan Approved

The approved amount may not be the same as the loan amount. The amount disbursed will depend on the lender’s assessment. The money will only be disbursed if all the paperwork is completed satisfactorily.

The following variables will affect the amount distributed:

  • The type of loan
  • Processor charge
  • Advance payments, if any
  • Service charges.

Factors Affecting Personal Loan Disbursement


All lenders have their own rules about how much a borrower should be earning. These rules help them figure out if they can pay their equated monthly instalments (EMIs). Most lenders want you to make at least Rs 15,000 per month.

Lenders may also look at how much money you have in your account after paying your EMI. They will approve the loan only if there is enough money left in your account.


The potential earnings increases with age. Individuals close to retirement may not be considered for loans as their earning potential reduces after retirement.

Helpful Factors for Personal Loan Disbursement


The Credit Information Bureau of India Limited’s (CIBIL’s) score or credit score determines whether you can get a personal loan. Check your CIBIL score before applying for a loan.

The credit score helps the lender determine if the applicant can repay the debt. The score also shows how the financial position of the applicant. You can get a personal loan with favourable terms and conditions if your credit score is at least 750.

If you have a good credit score, it will be easier for you to get a personal loan. It also helps you get a higher loan amount.

Rate of Interest (RoI)

Many lenders may offer low and appealing interest rates. Even though the offer may seem appealing, there may be hidden charges or conditions you are not aware of. You may end up paying more because the lender may have strict requirements.

Before applying for a personal loan, you must check your RoI carefully. It is also important to compare the interest rates of different lenders. Most of the time, loan interest rates calculated by lowering the balance are considered the best option.

Calculations of EMI

It is essential to figure out the EMI before getting a loan. Understanding this will make it easier to determine if you can repay your loan easily. It is essential to know how these EMIs are calculated.

If you don’t want to pay more than you have to, you can choose from options like no-cost EMI and advanced EMI.

Fees for origination

Some lenders charge fees at the start of a personal loan. The origination fee is a set amount that must be paid after the loan application has been sent to the lender or after it has been looked over.

How Is a Personal Loan Cancelled after Being Disbursed?

Once the money has been sent to your account, the personal loan can not be cancelled. The agreement binds before the money is sent to the account. This is the reason it cannot be cancelled. After the money has been disbursed, foreclosure is the only way to get rid of some debt. This can be done a year after on-time EMI payments.

However, you are free to turn it down after the lender has made a loan offer based on risk profiling.


Personal loans are easy to get. However, you need to do thorough research and choose the best option. Before applying for a loan, you must read the terms of several lenders carefully. It is also important to check out the financial institution and the lender.

With Piramal Fininace’s easy, short-form online personal loan application process, you can apply and get a personal loan quickly. To get started, submit the information and loan criteria. Visit the Piramal Finance website to learn to manage your finances efficiently.