What is IDFC FIRST Bank’s small amount Personal Loan?

There may be times when your monthly salary may not be sufficient to meet a sudden expenditure. If you don’t have an adequate emergency fund handy, you may have to opt for a short-term loan. A small amount loan can help you easily overcome minor shortfalls in your monthly budget. A small business owner facing a cash crunch can opt for a business loan as a short-term solution.

Small amount personal loans are borrowings that help you meet low-value liquidity needs. These unsecured loans are provided based on the applicant’s credit history and repayment capacity, and are immensely popular in the Indian financial market. Borrowers can use such loans for any purpose they like, whether personal or business-related. 

The popularity of small amount loans

In the five years ending FY 2021, personal loans have grown 2.3 times in value and 3.8 times in volume. Of this, small loans of less than Rs 1 lakh have grown three times in value and 11 times in volume! Also known as small-ticket personal loans, such loans account for nearly half of the overall personal loan market today. Much of this growth is due to the popularity of small amount loans among young adults in India. 

Due to the short-term nature and low values involved, banks and financial institutions are aggressively disbursing short-term loans, contributing to their growth. For borrowers, a small amount and flexible tenure mean less repayment stress. Taking these benefits into consideration, it is no surprise that short-term loans are gaining popularity.

Features and benefits of small amount loans
 

Quick process

A small amount loan is one of the fastest ways to arrange funds. Most leading banks and financial institutions allow you to apply for small amount loan online. For instance, to avail of the IDFC FIRST Bank small loan, simply click the ‘Apply Now’ link on the official webpage and follow a few steps to complete the process. 

Hassle-free procedure

Small loans offered by most banks flow through a completely digital process. The application is submitted online and the documentation is furnished as soft copies. All paperwork, including disbursal, can be carried out online.

Affordable interest rate

If a person with a good credit score applies for a small loan, the interest rate can be significantly low. Besides, small loans are comparatively cheaper than other readily available fund options like credit card cash advances and payday loans.

Fast disbursal

Once your small loan application is processed online and approved, you can find the loan amount transferred to your bank account in just a few hours.

Easy loan transfer

Existing loans can also be transferred into a small personal loan, as offered by IDFC FIRST Bank. Banks offer attractive personal loan interest rates on the balance of loan transfers from other banks and institutions. The balance may be an existing personal loan or credit card dues.

Flexible tenure

Small personal loans come with a flexible repayment tenure. You can avail of an IDFC FIRST Bank small loan for a period ranging between six months and five years.

Terms and conditions of small amount loans

The terms and conditions of small amount loans can vary from lender to lender. Here are a few terms and conditions for IDFC FIRST Bank small personal loans:

• The interest rate for an IDFC FIRST Bank personal loan starts at just 10.49% p.a.
• A processing fee of 3.5% is deducted from the loan amount upon disbursal
• A late repayment fee of 2% is charged, which can never exceed Rs 300. Stamp duties are charged as per actuals.
• You can make a prepayment with your own funds after paying 12 or more EMIs. This attracts a nominal pre-closure charge
• Repayment tenure can extend from 6 months to 60 months

Borrowers can check their repayment schedule online by logging into the IDFC FIRST Bank customer portal. The schedule provides the EMI amount and the break-up of the principal amount and the interest amount. 

IDFC FIRST Bank doesn’t charge or encourage any hidden costs with regard to the loan interest, processing fees, or loan repayment charges. All applicable charges are clearly informed to the borrower.

Eligibility and documentation for small amount loans

Short-term loans can be availed of by salaried individuals as well as the self-employed. Salaried individuals above the age of 23 can apply for this loan. The maximum age of the applicant at the time of the maturity of the loan can be 60 or retirement age, whichever comes first.

In the case of self-employed individuals, the minimum age of the applicant must be 25. The maximum age at the time of loan maturity is 60. In the case of self-employed applicants, the business of the applicant must have a legacy of at least three years.

All applicants must furnish a PAN card or Form 60. Identity and address proof (passport, Aadhaar, Voter’s ID, driving licence, etc.) must also be provided. Documents like utility bills and property sale deed, latest bank statement, passbook, rent agreement, etc., also suffice as address proof in a few cases. Additionally, proof of existence of the business may be required. 

How to apply for a small loan with IDFC FIRST Bank
 

• To apply for an IDFC FIRST Bank small loan, visit the official website or open the loans app
• Fill out an application form with all the correct details
• The bank checks your eligibility and approves your loan request
• You can then upload the supporting documents and get the document verification process underway
• The bank carries out the document verification process and credit checks, after which your loan is approved and the loan amount is transferred to your bank account

Conclusion

Unexpected financial needs can unsettle our budget once in a while. A quick swipe of the credit card or a credit line may be convenient, but a debt trap lies ahead if you don’t manage your money properly. A small loan is a far more convenient and affordable source of funds for meeting short-term emergencies. You can apply and get a small loan quickly and without hassle. With EMIs starting at Rs 2149 per lakh borrowed, IDFC FIRST Bank can be the ideal choice for your small amount personal loan.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.