Salaried personal loans are an excellent financing option for salaried individuals looking for financial assistance for personal needs or expenses. These loans offer a low-risk borrowing option to meet specific monetary requirements without having to go through the expensive credit card route or borrowing from family and friends.
What is a Salaried Personal Loan?
A salaried personal loan is an unsecured loan that is available to salaried individuals based on their income, credit history, and other factors. The loan can be used for various personal expenses, including home repairs, education fees, wedding expenses, medical bills, home renovations and much more. In comparison with other loan products, such as credit cards or traditional personal loans, salaried personal loans often feature lower interest rates, longer repayment tenures, and easy application processes.
When it comes to borrowing money, two of the most common types of loans are personal loans and salaried personal loans. The primary difference between these loans is that salaried personal loans are designed with salaried individuals in mind, with policies and terms structured to fit their specific financial requirements. This article will go into more depth about the differences between personal loans and salaried personal loans.
What are Personal Loans?
Personal loans are granted on the borrower’s credit score, income, and repayment track record. These loans are unsecured, which means that a borrower does not have to provide collateral to secure the loan. Personal loans have high-interest rates compared to secured loans, but they have some advantages such as fast disbursement, an easy application process, and flexible repayment terms.
What are Salaried Personal Loans?
Salaried personal loans are granted to salaried individuals who receive a fixed income from their employer every month. These loans have an affordable interest rate, longer repayment tenure, and less stringent eligibility criteria than other personal loan products. Salaried personal loans go a step further to address the financial concerns that salaried employees face and often offer a more personalized lending experience.
The Differences Between Personal Loans and Salaried Personal Loans
Eligibility Criteria
Personal loans often require stringent eligibility criteria, including a high credit score and an excellent repayment track record. Salaried personal loans, on the other hand, have relaxed eligibility criteria, including a fixed monthly income and employment as a salaried employee that can help the borrower obtain the loan more easily.
Interest Rates and Repayment Periods
Personal loans have higher interest rates than salaried personal loans, which can be challenging for borrowers. Salaried personal loans, on the other hand, often feature substantially lower interest rates, making them more manageable for borrowers. Furthermore, the repaying tenure on salaried personal loans offers borrowers more extended disbursement periods, ranging from one year to as long as five years, offering ample time for repayments without imposing a financial burden on the borrower.
Speed of Disbursement
Personal loans often require a more extended processing time than salaried personal loans, which are disbursement-focused and offer quicker processing. The affordability and simplicity of personal loans come at the cost of longer processing durations, usually up to 7-14 days, while salaried personal loans can be availed in as little as 48 hours.
Collateral Requirements
Personal loans are usually granted without collateral, whereas salaried personal loans can require collateral, which can be property, shares, fixed deposits, etc. The primary advantage of salaried personal loans is that borrowers can avail secured loans with favourable loan rates, reducing the risk of default in the creditor’s eyes.
Eligibility Criteria for Salaried Personal Loans
The eligibility criteria to avail of a salaried personal loan may differ with various lenders. However, the following criteria are common standards for most lenders.
1. Age
The age criteria for most lenders offering salaried personal loans is between the ages of 21 and 60 years.
2. Employment Status
The borrower must be a salaried employee or a self-employed individual with a consistent source of income.
3. Income
The borrower should have a minimum monthly income starting from Rs. 15,000 to avail loan.
4. Credit History
The borrower needs to have a good credit score or at least a fair credit score to qualify for the loan. Having a good credit score allows a borrower to receive a more significant loan amount with better loan rates.
5. Documentation
The borrower should provide the necessary documentation, including salary slips, bank statements, ID proof, PAN card, and address proof.
6. Other Requirements
Other minor requirements, such as the applicant’s job location and work experience, may also influence the eligibility for salaried personal loans.
Benefits of Salaried Personal Loans
1. Low-Interest Rates
Salaried personal loans offer lower interest rates when compared to other forms of borrowing such as credit cards. The interest rates for these loans start at 10.50%, making it a cost-effective way to finance personal expenses.
2. Longer Repayment Tenures
Lenders offer a repayment tenure of up to 60 months, making it more manageable for borrowers to repay the loan without a burden.
3. Unsecured Loan
Salaried personal loans are unsecured loans, meaning that borrowers do not have to pledge any asset as collateral for the loan.
4. No Pre-Payment Penalty
Unlike traditional loans, salaried personal loans do not carry any pre-payment penalty charges for borrowers who wish to repay the loan amount before the tenure’s end.
Best Apps to Avail Salaried Personal Loans
1. Bajaj Finserv App
Bajaj Finserv App provides excellent loan offerings for salaried individuals. The app offers salaried personal loans up to Rs. 25 lakhs, with instant approvals and disbursals. The borrower can avail of flexible repayment tenure, minimum documentation requirements, and competitive interest rates using the app.
2. Moneytap
Moneytap is a personal loan app that offers a low-cost alternative to salaried personal loans. It provides personal loans up to Rs. 5 lakhs with flexible repayment terms and instant disbursal.
3. PaySense
PaySense is an app-based lending platform that offers quick and hassle-free personal loans to salaried individuals. The app allows users to apply for a loan of up to Rs. 2 lakhs and repay in flexible monthly instalments.
In conclusion, salaried personal loans are a convenient and affordable way to obtain financial assistance for personal needs or expenses. When selecting a salaried personal loan, consider the eligibility requirements, interest rates, repayment tenure, and other loan terms before making a decision. The Bajaj Finserv App, Moneytap, PaySense, NAVI and Moneyview are all excellent platforms for salaried personal loans that offer great loan products with minimal documentation requirements, lower interest rates, and more flexible repayment tenures.
