Regardless of how well you arrange your finances, occasionally unexpected financial requirements arise, usually when you least expect them. In these circumstances, your only options are to borrow money from friends, take out a loan, or use your credit card. Each choice has benefits and disadvantages. It is questionable whether borrowing from friends or family will affect relationships in the long run. So, taking out a personal loan or using credit card debt as collateral are two viable choices. Even among them, credit card borrowing pales in comparison to personal loans by a significant margin. Therefore, a personal loan is your best option if you need money to cover a personal expense, consolidate debt, relieve liquidity issues, pay for a medical emergency, or for any other need.
What is A Personal Loan? Meaning & Definition
Read on to know Personal Loan meaning and Personal Loan definition.
A Personal Loan is an unsecured loan that can help you meet your current financial needs. The loan does not require you to pledge any security or collateral and is available with minimum documentation. The lump sum from the personal loan can be used to fulfil expenses, such as home renovations, marriage expenses, medical emergencies, funeral costs, etc. You can also use a Personal Loan to consolidate different debts or ease a liquidity crunch.
Unlike a credit card, a Personal Loan gives you a lump sum amount to use at once. You pay back the amount plus interest in pre-agreed monthly instalments over the loan tenure. Most people prefer personal loans as an alternative to credit cards because often Personal Loans have lower interest rates than credit cards.
Also, you can use a Personal Loan amount to fulfil nearly any kind of expense that is personal in nature, such as some of your goals, needs, emergencies, etc. Moreover, owing to the ease of online Personal Loans and the increasing competition, availing of a Personal Loan is cheaper and more accessible than ever before. In contrast to credit cards, Personal Loans are available at a fixed rate of interest for any amount you want to borrow. However, credit cards are revolving debts, where you can borrow the balance of the funds after spending per the credit card limit.
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What Are The Uses of Personal Loan?
credit success does not levy any restriction on the usage of funds from the personal loan. You can use the lump sum from your personal loan as you deem fit. Here are six cases where you could use a personal loan from credit success
Buy New Electronic Appliances
Money from personal loan can be used for buying new electronic equipment, such as refrigerator, washing machine, TV, AC, etc. A growing family or growing aspirations demand that appliances in the house are up-to-date and cater to the needs of everyone.
Upgrade To The Latest Smartphone
As consumers become more upwardly mobile, they prefer to have the latest smartphones in their hand. Also, smartphones have become like mini-computers / mini-laptops and a large chunk of office work is done on a good smartphone. Hence, consumers can avail of a personal loan to fulfil this need / desire.
Sponsor Wedding Expenses
In India, weddings are one of the heftiest financial investments. With each year, weddings are getting costlier. You can use a personal loan to finance your or your children’s wedding expenses and ensure the functions are done well.
Meet Medical Emergencies
Medical emergencies like an accident, critical ailment, serious injury, etc., often come unannounced. In such situations, financial support from a personal loan is of utmost benefit. With a personal loan, you can get the best possible treatment without worrying about finances. The lump sum from the loan can be used to pay your treatment expenses.
Fulfil Higher Education Expenses
Education, in India or abroad, has become highly expensive. As a parent, you can take a personal loan to cover the higher education costs of your children.
Accomplish Travel Goals
Most often, people wait for sufficient funds to fulfil their dream of travel. However, life is uncertain and too short to be spent waiting for the right time. If travelling is your passion, you can use a personal loan to accomplish the goal.
Purchase Home Appliances
Home appliances like a fridge, air conditioner, washing machine, television, etc., is important but also significantly costly. You might have to save for several months and cut down other necessary expenditures to buy these home appliances. However, if you do not have funds on hand, a personal loan can provide you with much-needed financial support. You can use the funds from the loan to buy household appliances or electronic equipment immediately.
Apart from these reasons, you can use a personal loan to cover funeral costs, moving expenses, pay credit card dues, buy a vehicle or an expensive gadget, etc. There is no restriction on the usage of personal loan money, so you have complete freedom to use the lump sum as you deem fit. You could even use the money for two or more two purposes, as per your financial requirement.
Few Important Factors to Keep in Mind Before Applying for Personal Loan
Here are some important things that you need to keep in mind about Personal Loan before applying for it
Understand Your Funding Needs
Before you apply for a personal loan, it is essential to know how much you need. If you require funds for a medical emergency or for going on a vacation, the assessment in both cases will be different. Therefore, it is critical to understand your precise financial requirements and choose the personal loan amount accordingly.
Minimum and Maximum Funding Available
The bank or lending financial institution assess your personal loan application and sanction the loan amount. The amount of personal loan you can avail of depends on your income level, profession and lender’s assessment of your loan application. If you are a business owner or self-employed person, the personal loan amount will depend on your profit and loss statement. However, if you are a salaried individual, the lender will assess your monthly salary and credit history before sanctioning the personal loan. Apart from restricting the amount per your financial assessment, the lender also limits the maximum and minimum funding available. Hence, it is advisable to always check for the maximum and minimum personal loan funding available.
Compare Different Interest Rates
Each lender levies a different interest rate on personal loans. The average interest rate for personal loans is between 10-26% per annum. The higher the interest rate, the higher will your personal loan repayment burden. Hence, before applying for a personal loan, check interest rates across different lenders and choose one that offers the minimum interest rate.
Processing Fee
At the time of processing the personal loan, the lender bears some charges related to the administration. Even though the amount is small, it is not added to the personal loan amount and is levied individually in the form of a processing fee. Each lender charges a different processing fee. Hence, comparing the fee across lenders is wise and applying for a personal loan from a lender that charges the lowest processing fee.
Pre-Payment or Foreclosure Charges
Lenders allow you to prepay or foreclose a personal loan after the expiry of a specific period. However, some lenders levy foreclosure charges on closing the loan before the pre-agreed tenure. It is wise to select a lender that charges no or minimum pre-payment or foreclosure charges.
The Credibility of Loan Provider
When applying for a personal loan, choose a lender that enjoys a good reputation in the market. Assess the credibility and reliability of the loan provider before taking the personal loan. Choosing a credible lender will ensure you are secure against any legal or financial hassles that may arise during the loan term.
Availability of Digital and Contactless Processes
Gone days when applying for a loan was cumbersome. Today, personal loans are available within a click and from the ease and comfort of your home. Hence, when assessing the personal loan lender, check if they offer a contactless and simple online application, approval and disbursal loan process. Facilities like online application, direct account transfer, mobile app, digital payments, etc., assures comfort and ease.
Minimal Documentation
To avail of a personal loan, you require to submit minimum documents, such as identity proof, income proof, residence proof, etc. Seek a lender that asks for a minimal hassle-free documentation process rather than a complicated one.
Time of Approval and Disbursal
Personal loans are meant to fulfil your sudden or unexpected financial needs. In most cases, you would require a personal loan sum immediately or in some days. Therefore, assessing the approval time and disbursal of the personal loan is critical. Choose a lender that has a quick and easy approval and disbursement process of loan so that you can access the funds at the earliest possible.
Convenient Tenure
The loan tenure has a significant impact on your monthly instalments. The longer the loan term, the lower would be the burden of the monthly instalments. Alternatively, the shorter the personal loan tenure, the higher will be the monthly instalments. Before applying for a personal loan, check the tenure specifications of the personal loan, and preferably, choose a longer loan term.
Interest Rates and Charges Applicable
Here is the full disclosure of all interest rates and fees related to credit success personal loan
| Particulars | Figures* |
| Interest rate | Starting at 9.99% per annum. The exact interest rate depends on your loan eligibility, credit score, etc. |
| Pre-payment charges | Zero pre-payment charges on foreclosing personal loan before the fixed tenure. However, the foreclosure should be from owned funds. |
| Loan processing charges | Between 0% and 2% per profile plus taxes. |
| Late payment penalty | Rs. 500 bouncing charge/bounce plus taxes 2% penalty on the unpaid pending interest amount, if any. |
*T&C apply. These numbers are subject to change depending on existing offersFor more details on Interest Rate and charges, please Click Here.
Perosnal Loan Eligibility Criteria
Eligibility criteria for personal loans from credit success are
| Criteria | Requirement |
| Applicant age | Minimum 24 years at the time of loan application and maximum 57 years at the time of loan maturity. |
| Work experience | Minimum work experience of one year with at least two months of stability with the current employer |
| Income | Minimum net salary of Rs. 30,000 per month |
| Employer category | Applicant should be full time employed with a company, private or public limited corporation or LLP. |
| Citizenship | Available only for Indian citizenship holders |
Features and Advantages of Personal Loan
Here are some of the prime features and advantages of taking a personal loan from credit success are
- High lump sum amount of up to Rs. 30 lakhs
- No constraint on the usage of funds
- Unsecured loan with no need to pledge any security or collateral
- Affordable, industry-lowest interest rates starting at 9.99% per annum
- Simple and minimal documentation
- Quick approval and hassle-free process
- Completely transparent loan processing, approval and disbursal
- Easy and contactless online personal loan application process
- Flexible repayment tenure of up to 60 months, according to your convenience
- No hidden fees or charges
- Zero pre-payment or loan foreclosure charges
- Seamless customer support
- Special festive offers on personal loans
- Documents Required for Personal Loan
Here is the list of documents needed to present when availing of a personal loan from credit success:
| Documents List | |
| KYC documents | PAN card Aadhaar card |
| Address proof | Electricity bill or rent agreement or Indian passport |
| Income proof | Latest monthly salary slip from the current employer |
| Bank account statement | Original bank statement for the latest three months in PDF format. |
Act Now to Avail of the Best Festive Offers, Or Get in Touch With Us!
Everything, right from the personal loan application, approval and distribution, at credit success are simple, transparent and fast.
In order to apply for Personal Loan with low interest rate, Click here. In case of any queries and to know more about Personal Loan, contact us or refer to the FAQ section on the website.
