For over years different forms of debts have been made available to borrowers by banks and financial institutions. Ever since digitalization has taken over, there has been a boom of the availability of all commodities online. Technology and innovation have been merged to provide the best of services to consumers. Likewise, the debt segment has also seen a transformation. Unlike the traditional approach, debt providers have innovated customised and convenient personal loan products and have made them accessible on online platforms. Here’s a comparison between bank loans and online loans -
1. Convenience: Online personal loans are accessible from anywhere even from the comfort of your home. All you require is an internet connection to be able to access a mobile loan app. However, in case of bank personal loans, you need to visit the bank physically. You are required to contact the person in charge, acquire the necessary details, fill loan forms and carry out the necessary paperwork.
2. Know Your Customer (KYC) documentation: KYC documentation is a mandatory part of any financial transaction. In case of an online loan, you are required to upload the essential documentation online. No physical verification is required as it is an automated, paperless process. In case of offline loans, you need to visit the institution or bank and submit the required documents in order to proceed with the further verification process. It needs to be submitted at the branch where the application has been applied for, for further processes.
3. Processing time: Online loans require a lesser time for processing a loan application as compared to that required by banks. This is the result of the paperless and automated process as compared to the involvement of a person to carry out the processes physically. The lender does digital verification and once it is done, your loan is sanctioned. In the case of bank loans, the processing time is higher. The loan disbursal takes place only after all the documents have been personally and manually verified.
4. Feature comparison between products: With emerging online loans, a borrower has the benefit of comparing various products and features of various debts products. But when you want to compare products in offline loans, you need to visit every lender individually, collect information, and compare each of them manually, before choosing the best fit product. This task could be tedious and time-consuming.
5. Transparency of charges involved: Alike how products and features of loans are provided online, vendors also provide all the necessary product-related details like interest rates, applicable charges etc online. There are no hidden charges that take you by surprise. For offline loans, you may have to incur additional cost on document attestation or pay some amount to the agent's commission in order to process your loan application.
What are the emerging trends in the Personal loan segments?
Features like easy accessibility, conveniences, customization and instant approval and disbursal are making online personal loans gain popularity. The market for such loans is growing, and digital lenders are capturing large markets. Looking at the market growth of instant loans, traditional players like banking institutes are expanding into e-commerce platforms.
Loan Products like EMI Free Loan, Credit Card Takeover loan, Rental Deposit Loan, Advance Salary Loan, Travel Loan, Wedding Loan, Super Bike Loan, and Personal Overdraft Facility are products; all designed to meet the lifestyle needs of consumers.
The evolution in the personal loan segment has helped to meet financial requirements instantly! It is just a matter of choosing the right personal loan from the right lender!