Personal loan: Why should a tiny sum be raised from a digital lending app instead of a bank? | Mint

If you find raising a personal loan from a bank a cumbersome process, then you can – among other things – raise it from a digital lending app.

One of the key differences between a bank and a digital lending app is that unlike an app, a bank typically requires applicants to possess a good credit score (usually above 720) and may even ask for a formal process which may be time consuming.

On the other hand, the process to raise a loan from a loan lending app is quite simple and short. One can raise a personal loan within a day, and in some cases – even within a few hours. Not to mention that the digital lending apps tend to approve applications even of those whose credit score is on the lower spectrum.

Raising a small amount

Some applicants raise a loan from a lending app because the amount involved is quite small.

When you happen to raise a small amount, say ₹50,000 or under ₹1 lakh — instead of going through the rigmarole of coordinating with a mainstream bank, you can simply raise the tiny sum via a digital lending app.

Steps you can take to raise a personal loan:

1. At the outset, check your credit score and ascertain your eligibility for procuring the loan at the loan you are applying for.
2. Enter your mobile number followed by OTP sent on the number.
3. Enter your details such as PAN, income, salary details, bank account and loan amount you want to apply for.
4. Choose the loan repayment wisely. Make sure you have financial bandwidth to repay the loan on time. To calculate the EMI which is optimum for you, make sure to use the Personal Loan EMI Calculator.
5. Finally, submit the application.
6. Once this application is approved, the digital lending app will disburse the money in your account.

(Note: Raising a loan comes with its own risks. So, due caution is advised)