The disbursement meaning in the lending domain refers to a lender paying the loan amount to the borrower. Usually, the lender disburses the amount into the borrower’s bank account. Lenders disburse funds either in a lump sum or in pre-decided instalments.
For example, when you take a construction loan, the lender may disburse the loan amount in instalments. This is not the case when you take a personal loan, where the financial institution usually disburses the amount all at once.
Now that you know what is disbursement, make sure you choose a lender based on the disbursement timeline. Some lenders offer you the benefit of disbursal on the same day of approving your application, which helps you address urgent needs easily.