Points to be followed when taking advantage of instant online loans

Points to be followed when taking advantage of instant online loans

In the current digital age, instant payday loans have become the new norm. Fintech brands have seen significant growth in the last few years, especially during the pandemic, when people were adapting faster than ever to digital money transactions. More and more people have studied and borrowed from banks and NBFCs for one reason or another. The best thing about online loans is that there are tons of options available and the borrower can easily evaluate the interest rates offered by various fintech companies.

Another important advantage when lending online is that the process is better simplified with limited paperwork and offers the benefits of in-house services. Additionally, you can choose from a wide loan category such as personal loans, medical loans, travel loans, home loans, car loans and many more.

While the loan process has been digitized and simplified, at the same time it is important to know some important tips to get the maximum benefit from your lender.

Make sure the Fintech platform is authentic
A digital lending platform can take many forms. For example, it could be an NBFC registered independent lending platform, a bank or an organization that works with a bank or NBFC. The key here is to check and verify that the lender is NBFC registered. You can get a loan from a bank, NBFC, or an affiliate of any of these two entities. These are safe options for the borrower.

If you come across a lending platform that doesn’t display your NBFC license number on their website, it’s best to stay away from such sites. No matter how attractive the loan offers or the interest rate are, these are not safe options for you. Also, make sure your bank / NBFC is registered with a central bank or state government, as they license these entities to offer digital loans. Unless you find an authentic platform based on these two very important criteria, it’s best to avoid sharing your personal and banking information online with them.

Loan approval without KYC
With the introduction of Aadhaar in the country, we have all been linked to an identity card that acts as an authentic document of our identity. Therefore, all reputable lending platforms check Aadhaar information and conduct online KYC to ensure transparency on both sides. Therefore, if the digital platform offers a loan without KYC, it is inappropriate and chances are it is a scam that could lead to identity theft or financial fraud leading to huge losses. It is absolutely best to avoid platforms that do not perform KYC prior to loan disbursement.

Avoid hidden fees
Some digital loan platforms impose unnecessary hidden fees on the loan, such as late application fees. Some employ a manipulative methodology with interest rate fluctuations that are completely unethical and place an unnecessary burden on the borrower. Late filing fees are a popular scam where people pay 2-3% more for no reason. Therefore, be careful when taking out loans and read your documents carefully.

Please read the documents carefully
As we have already suggested, it is very important to read the offering documents, which contain the duration of the plan, the interest rate and the terms of your credit policy. This is the best way to avoid fraud, unnecessary trouble and fees

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