Last Updated on July 10, 2023 by
Pre-approved personal loans are short-term loans made available to a chosen group of clients. No collateral or security is required, and minimal to no paperwork is required. To be qualified for a quick loan, you must have a strong credit history and a track record of repayment.
Many banks and non-banking financial companies (NBFC) in India provide this loan facility to improve loan product sales, address clients’ urgent financial demands, and significantly reduce loan disbursal time. The interest rates on pre-approved loans vary from lender to lender, so you should verify with the lender before taking out a personal loan. You can also get loan offers and personal loans without documents.
The lender may have verified your credit score and determined that you are an excellent client; they may have evaluated your credit history and decided that you have a good bank balance and transaction rate. You may have previously obtained a loan and made fast and consistent payments.
Pre-approved personal loan benefits
Quick loan disbursement: If you are an existing client of the bank or NBFC, the pre-approved loan will be sent instantly into your account.
Minimum paperwork required: Instant loans are simple to get; the procedure is deemed easy since loan acceptance does not need much paperwork.
There is no need for collateral: Customers who have been pre-approved for loans do not need to offer any security or collateral to access immediate loans.
Variable loan amounts: Each person’s instant pre-approved loan amount is unique. The loan amount is determined by the customer’s credit and repayment history.
Repayment option: You must pay back pre-approved loans in Equated Monthly Instalments (EMIs). Customers who already have an account with the lender may use the auto-debit feature to pay their EMIs. The average payback period ranges from 12 to 60 months.
Banks use instant pre-approved loans as a promotional tool to enhance loan product sales. There are various reasons why you can be selected as an eligible customer:
The Advantages of Pre-Approved Personal Loans
- Quick financing or instant funds: Being eligible for an instant pre-approved loan provides a safety net when you need quick money to satisfy your financial obligations. If the verification procedure is successful, the loan will be authorized and disbursed within a few minutes on the same day. You may apply for the loan for any personal reason.
- Competitive interest rates: If you have a strong credit history, you may be qualified for a quick loan offer. Because you have a good repayment history and don’t fall into the lender-risk/credit-risk group, the lender will give you a loan at a reasonable interest rate.
- Loan tenure: You may pick a loan payback duration that works best for you. It is generally between 12 and 60 months. Consider your repayment potential while selecting the loan duration to avoid loan default.
- Minimal to no documentation: Existing clients qualified for fast loans do not need to provide documents since the lender already has your KYC, bank, and income information in their database.
- Paperless loan application process: Most lenders have an online lending facility where you may apply for a pre-approved loan by filling out and submitting an online form via their website or mobile app. Soft copies of the needed papers may be submitted in the proper format to the lender’s website or mobile app.
- Faster processing time: You will not be subjected to extensive examination because you have previously met the loan’s eligibility requirements. If your paperwork is in order and your financial information is correct, your loan might be authorized and disbursed within a day.
- Power in negotiations: Instead of you stepping in with a request, the lender approaches you with a product in a pre-approved loan. This implies you may negotiate the loan conditions with your relationship manager to lower the interest rate or extend the duration or payback time.
- Special offers: To entice you to take out a pre-approved personal loan, the lender may provide little incentives such as a processing fee waiver, a lower interest rate than for ordinary clients, EMI breaks for 1-3 months, and so on. If you need a loan, these benefits will assist in minimizing your total predicted debt.
How do I get a pre-approved personal loan?
- Check with your lender to see whether you qualify for a pre-approved loan offer. You may check whether you are qualified for a pre-approved loan by logging into your lender’s website.
- Submit a completed loan application form, available via the lender’s website, branch office, SMS, or mobile app.
- Choose the appropriate loan amount and payback term.
- After satisfactory verification by the lender and acceptance of the offer, the loan amount will be deposited into your bank account.
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