You must have come across many marketing calls or advertisements claiming to provide you with a personal loan just sitting at home with approval within seconds. Do you know how this became possible today? There was a time just a few years back when getting a personal loan was a long time taking and tedious process. Financial institutions used to disburse loans only after verifying many of your documents physically. The individual loan interest rate was also decided after many procedures such as physical inspection of collaterals, bank statements, income proofs etc. But now, even a personal loan in India is available at an instant delivery just because of technology.
Let us understand how technology is leveraged to disburse personal loans in India.
Online Services
With the digitisation of financial institutions, most of the services these financial institutions offer are available via online modes. Now you can access their services 24*7 just by using their mobile application or their websites. You need to log in to their portals with your customer id and password, and with a few clicks, you can submit your loan application.
New technology upgrades
Now the granting loan system in India is equipped with the latest technology, including Artificial Intelligence (AI), data analytics and many more. After integrating these technologies in the financial sector, you must submit your application. You can upload the scanned copies of your required documents along with your application. Now, your application is then scrutinised to check your loan eligibility. The AI and data analytics check your history, including past loans, income tax returns, bank deposits, etc. This also marks the importance of a credit score directly responsible for your loan eligibility.
Budget Planning
Before you decide to take a loan, you must have a figure in your mind. Some take a loan to fund their outing or family trip, some may take it for construction or repairs at the house, maybe for a medical emergency and many more reasons. Once you decide on an amount you need, you must plan the EMI that your budget allows you to pay based on the personal loan interest rate on that loan.
Most of these financial institutions provide you with a personal loan EMI calculator facility on their app or website. Now using this personal loan EMI calculator, you need to put some information such as loan amount, tenure, frequency of instalments, individual loan interest rate, etc. Within a few seconds, you can determine your EMI. You may even check and compare the EMIs by modifying a few factors. This quick personal loan EMI calculator is also the result of technology used to make informed and quick decisions.
Approval in seconds
With traditional lending ways, you had to visit the bank branch, wait for hours, or sometimes visit several times to see if your application is accepted to grant you a loan, irrespective of the amount. However, you don’t have to take the hassle after digital lending. Financial institutions now function with specific risk-assessment algorithms to analyse your profile. Your verification is completed within a few minutes, your verification is completed and once approved, your desired loan amount is disbursed to your account.
To conclude, technology has played a significant role in making loan disbursement in India a quick process. It has out shadowed the traditional ways. Since most financial services are now available just a click away, getting loans is not left behind while not compromising security. This technology change even benefitted us during the pandemic, making loan disbursement possible even in those tough times.
