As online personal loans are gaining popularity, the trends in the personal loans market are changing. Personal loans have become a prudent way of financing. With the ease of access, consumerrs are now turning to personal loans for some big-ticket purchases. It is not only banks but also Non-Banking Financial Companies (NBFCs) who are now offering Personal loans at competitive interest rates. According to a report by the Reserve Bank of India, unsecured finance, which includes personal loans and credit card debt, amounted to Rs. 576,600 crore or $82 billion at the end of FY18.
As the lending and borrowing process is getting simpler by the day, the rate of preference for personal loans is getting exceptionally high. Modern day Indians are no more skeptical when it comes to taking loans, unlike the older days. Let’s have a look at a few game-changing trends of the Personal loans market in India.
Digitization of Personal Loans
First and foremost, the trend that has changed the face of personal loans in India is the digitization of the market. All Banks and NBFCs have an online portal where the consumers can do a personal loan application in just a few clicks.
Flexible Tenure and EMIs
You are allowed to choose a tenure totally based on your repayment capacity. You can also avail a short term personal loan and repay it in a short time. Your personal loan EMI is also flexible. You can now increase or decrease the amount of EMI as per your capacity. You can calculate your EMIs using the personal loan emi calculators, a new tech savvy feature offered by all the lenders.
As the trend of instant personal loans is gaining acceptance, Banks and NBFCs are promoting the concept of minimal documentation. Initially, you only have to submit your Address and Identity proof details and bank statements. The paperwork is less. The list of required personal loan documents is small.
Increase in Financial Awareness
More and more people are getting financially aware and are no longer considering personal loans a liability or a taboo. There is heightened interest and consumers are willing to explore such opportunities.
Introduction of Credit Score System
The process of lending has become less complicated with the introduction of a credit score system. The credit score is given by credit rating agencies such as Credit Information Bureau India Limited (CIBIL). If you have a good credit score than you are eligible for a personal loan.
There is a lot in store for the personal loans market in India in the coming year of 2019. As there are lifestyle changes and people are trying to increase their standard of living, personal loans will soon become a necessity.