Non-banking finance companies have reflected a gradual pick-up in momentum at a rate of 37.6 % in terms of sanctions at Rs. 1.24 trillion if the first quarter of FY22 from Rs. 90,615 crore in the first quarter of FY21. NBFCs have contributed majorly to strengthening India’s economy and have transgressed the service provided by traditional financial institutions.

NBFCs for personal loans segment continues to grow due to its less stringent terms and conditions, digital presence, customized services, etc.

However, with the availability of numerous NBFCs, finding the right lender could be tricky. Hence, borrowers should be mindful of specific parameters before choosing a financial company.

Know how to choose the best NBFC for a personal loan

Choosing the right lender plays a vital role in making the borrowing journey hassle-free. Here are the parameters individuals must factor in, while choosing an NBFC-

  • Compare varying interest rates: Different lenders have different offerings; hence it is imperative on the borrower’s part to compare various lending institutions and settle for one offering a reasonable interest rate. Even a slight difference in interest rate significantly impacts EMI pay-outs.
  • Online provisions: Several NBFCs come up with an online application facility helping borrowers seek financial assistance at their convenience. Hence, individuals must choose a lender that provides online provisions, thereby making the credit option easily accessible, making the borrowing option seamless.
  • Less stringent with CIBIL score: Credit score determines one’s eligibility per traditional lending system. On the other hand, NBFCs have a holistic view of evaluating credit scores, making NBFCs a viable preference. However, some NBFCs emphasise credit scores; hence it is crucial to choose a lender who is not stringent with credit scores.

An individual with a subpar CIBIL score must know how to get a personal loan with a bad CIBIL score.

  • Minimal documentation:  Borrowers should choose an NBFC that facilitates rapid fund disbursement with minimum documentation. Rigid documentation delays the lending process.
  • Loan principal: Before obtaining a personal loan from a non-banking financial company, borrowers must ensure that they opt for one providing a considerable loan amount. Furthermore, borrowers should inquire whether the lender offers a Flexi loan facility if one wants to withdraw money in parts and pay interest rate only on the used amount and not on the entire loan principal. In this regard, borrowers must know how they can benefit from Flexi personal loans.
  • Loan terms and conditions: It is equally important to check out each lender’s loan terms and conditions before choosing one. Some lenders offer flexible repayment tenor, some accept weekly instalments, while some do not charge any penalty fee on missing out on EMI payments. These lucrative offerings prove beneficial in the long run.
  • Prompt customer service: Additionally, choose lenders offering instant assistance to their customers, whether filling the loan application, document related concerns, providing the loan amortisation schedule or any other query.
  • Quick approval and processing: Moreover, borrowers must go to a financial institution that ensures rapid approval of the loan application and takes less processing time. Borrowers should be aware of how the disbursal process for a personal loan works.
  • Accessible eligibility parameters: Lenient eligibility parameters help one acquire funds during an emergency. Hence, one should inquire about the varying set of eligibility criteria and settle for the one with the most straightforward demand.
  • Add-on benefits: While applying for a personal loan from an NBFC, borrowers should factor in whether the lender is extending additional benefits like top-up loan option, overdraft facility, interest discounts etc., to cater to the dynamic financial need of an individual.

Furthermore, borrowers should opt for NBFC extending exclusive pre-approved offers, ensuring better loan deals and expediting the loan application process. These offers are available on a wide range of financial products like personal loans, business loans, credit cards, etc. Customers can check their pre-approved offers by entering their names and contact detail.

If borrowers do not wish to visit any lender due to monetary urgency and time crunch, they can avail of personal loans through an instant loan app offered by prominent lenders. These mobile applications ease the lending process and help track the loan status.

To sum up, individuals availing of personal loan from a non-banking financial company (NBFCs) get to reap the slew of benefits that helps individuals sail through financial turmoil. Moreover, NBFC personal loan caters to the financial need of any individual by extending customised offering several co-lending agreements, making these financial companies the most sought-after ones in recent time.

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