Digital Personal loans, also commonly referred to as instant personal loans, instant loans, online personal loans and quick loans, are loans that are processed digitally. This technically means that almost the entire process from beginning to end takes place without the necessity of cumbersome paperwork. Note that unlike digital loans or instant loans, traditional personal loans offered by banks and financial institutions involved, and still involve, a bunch of taxing paperwork requiring a host of signatures. 

While we explore the world of digital loans and how they’ve changed the lending landscape in India, let’s take a look at some comparative features – of instant loans and traditional personal loans. 

Here are some notable features of digital loans (instant personal loans):

Digital loans are literally “Instant”

Digital personal loans, also called instant personal loans, as literally instant. This doesn’t technically mean that you’ll receive the money instantly into your account – this means that you’ll receive instant approval based on your income and credit profile.

Easy eligibility parameters

Digital loans have easy eligibility parameters compare traditional unsecured loans offered by traditional banks and financial institutions. Most banks that are popular in the personal loan lending space don’t entertain applications that have a low credit score - low here indicates a score of less than 750. Digital loans, that are mostly offered by Fintech companies, entertain applications with credit scores as less as 600. 

Other related aspects like late payments and defaults will also severely affect your chances of getting a loan from a traditional or conventional lender like a bank. While defaults aren’t entertained by any lender, Fintechs do allow few instances of late payments in the past. However, defaults should ideally not have occurred in the last one year from the date of applying for the loan. 

Minimal paperwork 

Instant personal loans involve minimal paperwork, unlike conventional personal loans that require extensive paperwork and physical submission and verification of documents. As mentioned earlier, Fintech companies, who are pioneers in ushering in the new age concepts of digital loans and online loans, grant approval to customers within minutes by digitally verifying their credit profile. 

More so, customers are given the provision of submitting/uploading their documents online – all documents including income documents (salary slips), bank statements, identity documents, and residential documents can be uploaded on the web or mobile platform of the Fintech Company. 

The digital application process reduces turnaround times drastically – applications that used to take weeks (from traditional lenders), can now be achieved within 1-2 days because of the entirely digital process. 

Loans to employees of unlisted companies

One of the foremost advantages of digital loans is that these loans are provided to individuals employed with unlisted companies as well. Note that when traditional lending institutions screen a profile and evaluate the eligibility, they take into consideration the employee’s company/ organization. If the organization is listed on the bank’s database, the customer is temporarily approved. Note that banks only list companies that have a good credit outlook, stable and consistent revenues, and a market presence for a minimum number of years. 

Fintech companies like Qbera, however, caters to employees of almost 7 lakh companies in India, giving loans to even employees of unlisted companies. 

The fact of the matter, however, is that the employer information doesn’t become the only criteria for loan approval. While Fintechs provide loans to salaried individuals of unlisted companies, loans are provided only to deserving customers who are above the minimum credit eligibility threshold. 

Documents for a Digital Personal Loan with Qbera

Here are the documents that need to be submitted:

• Proof of Identity – Driving Licence/Passport/VoterID/Aadhaar/PAN

• Proof of Income – Salary slips for the last 3 months, Bank statement for the last 6 months (can be automatically sent through netbanking credentials)

• Proof of Residence – Utility Bill/Aadhaar/VoterId/Driving Licence/Passport

Note: Aadhaar and PAN are compulsory to apply for a digital or instant loan

Eligibility for a digital loan

You are required to meet the following eligibility parameters for an instant personal loan

• A minimum income of INR 20,000 p.m.

• A minimum credit score of 625. 

• You must be a salaried employee. 

• All documents submitted must contain credible information, which will be separately verified. 

• No instances of default should’ve taken place in the last 1 year.