In today’s age and time, getting a personal loan without any collateral is easy and hasslefree. The demand for personal loans has taken off among Indian customers, mainly due to their no-end use restrictions, 100% digital application procedures, and flexible repayment terms. Most borrowers prefer personal loans due to their quick processing and instant accessibility. An instant personal loan is a lifesaver when you need money for an emergency or plan something special. However, sometimes people need clarity on how long it takes to approve a personal loan to be able to plan funds better. Read on to learn about the timeliness of the personal loan approval process.
Several factors determine the speed of loan approval. Depending on the borrower’s circumstances, it may range from a few minutes to a couple of days. We will discuss a few crucial ones here.
The online loan application method can be significantly faster than offline procedures. It eliminates the visits to the lender’s office for the application, documentation, signatures, and verifications. In the offline procedure, the lender’s representative collects physical copies of your documents and submits them to the relevant departments. It may take them a few days to verify the details and documents. And if they need some more information, the approval process may take longer.
On the other hand, if you apply for a personal loan online, you can complete the application process within a few minutes from the comfort of your home. You can simply fill out an online application form, scan and upload the necessary documents, and get them verified within minutes. NBFCs that support 100% digital loan procedures can process loans much faster than offline providers.
Each lender has eligibility criteria that you must fulfill to qualify for an instant personal loan. Most loan providers’ eligibility conditions include your age, income, employment, citizenship, and work experience. If you do not meet their criteria, they may reject your loan application or ask for additional documents which can further delay your approval process.
You have higher chances of faster loan approval if you are an existing customer with the financial institution. Applying for a loan with a bank where you have a salary account is even better.
Applying to financial companies with which you already have an account can also increase your chances of getting a faster loan approval, provided you maintain a responsible credit history.
Most lenders prefer to lend to borrowers with a stable job. With a fixed income coming in every month, the certainty of repayments makes lenders confident about your application. On the other hand, self-employed individuals may have to work harder to prove their income consistency and move their application forward.
A job at a top-tier company may lead to faster loan approval than being employed at a smaller organization or start-up. Your work experience also significantly adds to your credit worth. If you have just started your career, have recently joined a new company, or are someone who changes jobs frequently, it might affect your application. On the other hand, work experience of at least a few years in the same job will assure job stability and attract faster approval.
Your credit score is crucial to your personal loan approval speed. The higher your credit score, the faster you can get loan approval with lower interest rates and favourable loan terms and conditions. The best way to get fast approval is to maintain financial discipline, reduce the DTI ratio, and use credit responsibly.
Before applying for a Loan, it helps if you maintain a good credit score. You can check you are credit score for free on OneScore, and improve your chances of getting an instant personal loan.
These are the steps involved in the personal loan online approval process:
Additional Read: Tips to Get Personal Loan For Marriage**
The time taken to approve a personal loan depends on the mode of loan application, your eligibility and preparedness for the application process, and the documents required. The faster you can provide these details and documents, the quicker you can get your loan approved. Additionally, you can also look out for any pre-approved loans that you may have.
Take these necessary steps to expedite your personal loan approval process:
Apply online to save time on branch visits and paperwork, and get instant online approval for personal loans.
Develop the habit of repaying your loan EMIs and credit card bills on time. You can also set up auto-debit to get it automatically deducted from your bank account each month.
Pay off your outstanding balances on loans and credit cards. Doing that will reduce your debt-to-income ratio and improve your loan eligibility for faster approval.
Diversify your credit portfolio with different types of loans, broadly categorized into secured and unsecured loans. It makes the lender confident that you can handle different types of credit responsibly.
Retain old credit cards as they increase your credit age and credit limit, which are two important factors that determine your credit score.
Factors like your loan requirement, eligibility, and credibility are important factors affecting the speed at which you can obtain a personal loan approval.
Check your loan eligibility and provide the necessary documents in time to get fast personal loan approval. If you fulfill all the requirements, you can be sure you will get approval for a personal loan.
The lender’s loan application procedure, your credibility and eligibility, and the documents you provide largely affect the time taken to approve a personal loan.
A higher credit score ensures the lender of timely repayment, which can lead to instant approval of the loan application. Therefore, your credit score is a crucial factor in determining your approval timeline.
When you apply for a personal loan, you get a reference number that you can use to track your application status. Provide this number online or to a customer representative to know your application status.
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**Disclaimer: The information provided in this webpage does not, and is not intended to, constitute any kind of advice; instead, all the information available here is for general informational purposes only. FPL Technologies Private Limited and the author shall not be responsible for any direct/indirect/damages/loss incurred by the reader for making any decision based on the contents and information. Please consult your advisor before making any decision.
- OneScore , October 17, 2023