According to recent data, by 2024, retail loans in India are expected to be worth approximately Rs.96 trillion. The advent of digital lending platforms has been instrumental in making the overall borrowing process less complicated for individuals. Presently, individuals can avail all types of loans online to meet various financial requirements.
Classification of online loans in India
Online loans in India can be broadly categorised into two types:
Asecured loan denotes the credits that can be availed by hypothecating an asset as collateral. Examples of secured loans include gold loans, loan against property, home loans and more.
Unlike secured loans, borrowers are not required to pledge an asset as collateral to avail a secured loan. These loans are approved and sanctioned based on the creditworthiness of an individual. Hence, an applicant must possess a decent track record of credit repayments which is reflected in their CIBIL score.
One of the most popular examples of an unsecured loan is a personal loan. This type of loan doesn’t have end-use restrictions and comes with flexible repayment tenures of up to 5 years. Hence, individuals can repay the loan EMI amount as per their convenience. Moreover, applicants can borrow up to Rs.25 lakh, which is disbursed instantly after the completion of a hassle-free application procedure.
In case of urgent fund requirement, Individuals can apply for a personal loan online by visiting the website of a financial institution. This type of loan enables them to finance various expenses such as medical emergencies, higher education, weddings and more with ease.