The financial services industry is leading the digital transformation revolution worldwide. Banks, NBFCs and FinTech companies are experimenting with emerging technologies to create progressive financial services for their customers. Smart analytics enables financial services companies to understand customer needs and preferences to design better products and services. Today, technology plays a significant role in marketing, implementing, and managing financial services across institutes.
A crucial aspect of financial services that has been influenced by evolving technology is the personal loan application process. Starting from how you apply for personal loans, the personal loan application process steps, and how you get a personal loan – each facet of the process has transformed with fast and efficient technological solutions.
Online Personal Loan Application
Ten or so years ago, if you needed a personal loan – you had to go to the bank, fill out the application form and negotiate with the lender on interest rates and repayment tenure. Online personal loan application processes have changed everything.
Now, applying for a personal loan from the comfort of your home is possible. All subsequent processes, including KYC verification, submission of necessary documents, and other details, are also done online. The process is convenient and easier to navigate for customers. It is also simpler for lenders to keep records online.
Here is a comparison of the traditional personal loan application process and the online personal loan application process.
| ONLINE PERSONAL LOANS | TRADITIONAL PERSONAL LOANS | |
| Convenience | You can apply from the comfort of your home, using your laptop or smartphone. | You must meet the lender and visit their office to complete all the formalities. |
| Submitting Documents | You can upload the required documents on the application portal for instant verification. | The process is paperwork intensive, and you need to submit hard copies of all your KYC documents at the lender’s office. |
| Processing time | Verification of documents is instant using artificial intelligence. And the entire approval process takes only a few hours, at the max. | As the verification process is manual, getting the approval and completing the loan processing can take a long time. |
| Charges | Charges required for the loan processing are stated clearly on the website/app. No additional charges. | Offline loan processing often has hidden charges involved. It could be a commission to agents or charges for expediting the process |
| Product Comparison | Several websites offer a convenient side-by-side comparison. | Comparing products is tricky as you must visit all lenders’ offices to get the necessary information. |
Benefits of Online Loan Application Process
With the application process going online for personal loans, a new culture in the financial services industry has emerged. It has enabled providers to develop customized products for their customers and offer quick processing. And it has also allowed customers to get the funds they need much faster.
Here are some notable benefits of the online loan application process:
- Reduced Paperwork – Traditionally, applying for a personal loan meant extensive paperwork. Banks and NBFCs must be thorough with their KYC verification and keep records of all the details about loan applicants. Since the personal loan application process has moved online, loan applicants have to deal with significantly less paperwork, which has also boosted the processing speed of personal loan applications.
- Quick Approval – By doing away with paperwork and enabling borrowers and lenders to operate online – there are no more delays in approvals for personal loans. Anyone in urgent need of a loan can be given a quick approval. Lenders can use their online records and analytical tools to assess a loan applicant’s creditworthiness. Then they may communicate their approval/denial within an hour.
- Customized Products – Earlier, only one kind of personal loan was available to all applicants. Irrespective of repayment capacity, income, or requirement of funds, borrowers had little flexibility to get the funding they needed. Today, technology allows lenders to customize loans and payback plans to offer better service to their customers.
- Flexibility – Online personal loans offer borrowers the flexibility to borrow anytime they need funds. With increasing market competition, several small and big lenders are willing to give instant loans based on eligibility. Applicants can complete the formalities on their website and avail of a loan whenever necessary.
Online Personal Loan Providers
In India, numerous banks, NBFCs, small lenders, and FinTech startups such as KreditBee provide online personal loans. Now that the application process is more straightforward, more people are availing of this facility. Besides leading banks such as ICICI, HDFC, SBI, etc., most NBFCs like Bajaj Finance, Aditya Birla Finance, and L&T also offer online personal loans.
KreditBee is an online platform that facilitates instant personal loans with hassle-free documentation and quick loan disbursal in just 10 mins for salaried and self-employed individuals. Private personal loans on KreditBee are processed through NBFCs or banks registered with the RBI. KreditBee offers Flexi personal loans, personal loans for self-employed and salaried, and online purchase loans. The application process is completely online, making it super convenient for borrowers.
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