Digital Personal Loan: Know everything about online borrowing

The digital personal loan is now an instrument you can access within seconds from your smartphone. Modern fintech solutions have made it so that you don’t need to worry about:

• Visiting physical branches 
• Applying manually for a loan 
• Submitting documents in person

Today, all you need is an offer from your preferred lender and you can get the funds you need in mere minutes. Read on to learn the digital lending meaning, its pros and things to consider before applying.

Understanding Digital Personal Loans

A digital personal loan, like regular loans, is a financing instrument that you can avail to meet your planned and unplanned needs. The main difference is that you don’t need to visit the bank to apply or manage it once approved. 

Here’s an overview of how these loans work:

• You choose a lender that accepts online applications for a personal loan
• You fill out the online application form and upload the required documents
• Wait for the lender to assess your application and verify your documents
• After the verification process, they approve or reject your application
• If approved, you will receive the funds in an account of your choosing

Do note that these online lenders evaluate your application based on your:

• Financial profile
• Credit report and credit score
• Income and employment
• Age and city of residence
• Existing credit accounts and credit history

Pros of a Digital Personal Loan

Here are the benefits of getting a digital personal loan:

1. Quick and Easy Application

You can apply for digital loans in just a few clicks on your laptop or your smartphone. This type of loan eliminates the need to make a trip to a lender’s branch. Moreover, you don’t need to ask for brochures to know the features and charges of the loans. This is because, in digital lending, this information is easily available on the lender’s website. 

Additionally, you can also manage your loan online, which includes:

• Checking the next due date for the EMI
• Knowing the repaid amount and the outstanding balance
• Making advance payments 
• Getting reminders regarding the due dates

2. Low or No Processing Fees

When availing any financing options, there are a few fees and charges, such as:

• Processing fees
• Late payment fees
• Foreclosure charges

Considering that these are digital loans, there are fewer overheads for the lenders to handle. As such, the costs are much lower. In fact, most institutions levy a nominal charge to process the loan. Some even offer loans with zero charges, enhancing the experience significantly. 

3. Instant Fund Disbursal

Another significant benefit of digital lending is that you get access to the sanctioned amount almost instantly. After you apply, lenders take little time to process and verify your application. As such, these instruments are ideal for almost any situation, even when you need funds urgently. 

4. Competitive Interest Rates

To make borrowing easier and more attractive, lenders offer various perks. These include lower interest rates as well. Since the overhead costs for these lenders are lower, they can offer loans at lower rates than regular loans. 

This is a notable advantage since interest charges can be quite substantial, making repayment a lot costlier. If not planned properly, you can also fall into a debt trap. However, with lower interest rates, such risks are lower as the EMI and total repayment are more manageable. 

Also Read: How to Get Instant Personal Loan of ₹50,000

Points to Consider Before Getting a Digital Personal Loan

While getting a digital personal loan, you must keep these points in mind:

• Choose a trustworthy lender to avoid fraud and protect your finances
• Assess your financial requirements thoroughly before deciding on the loan amount
• Check the eligibility criteria and documentation requirements beforehand to avoid rejections
• Choose the tenure smartly since it influences your digital personal loan EMI amount
• Opt for a lender that levies lower interest rates and other charges
• Read the terms and conditions associated with the loan carefully
• Check if the lending institution is authorised by the Reserve Bank of India (RBI)

Digital loans are an effective solution to meet all your time-sensitive needs and are easy to get. There are various lenders that you can choose from and one of them is Fibe. You can get an Instant Loan of up to ₹5 lakhs with minimal formalities and affordable rates.  

Download our Personal Loan App from the App Store or Google Play to get the funds you need with ease.

FAQs on Digital Personal Loans

How does a digital loan work?

These work similarly to regular loans. The main difference is that you don’t need to visit the lender’s branch to apply for and manage digital loans.

Is Digital loan safe?

Yes. However, choosing a trustworthy lender is the key to protecting your finances.