About online loan application

There are many agencies which have funds to give loan to the needy persons and then earn from the interest charged on loans. This has become a big business for those companies who are in the business of loan, insurance, mortgage or similar areas. As the investors are getting low return on their funds in banks or private companies the rates of interest of loans are also decreased in proportion and the loan market is buzzing with good activity. The entrepreneurs and small business initiators are in search of these loans which have attractive repayment schedules and easy processing. But these companies will not give loan just like that as they will check the documents of the loanee whether he has a capability of the loan repayment or not and if not what in lieu of that he can offer for mortgage or any other process of realising the debt from the loanee.

There are many online agencies which are engaged in this business but one has to be careful before venturing into the loan contract and should assure about the reliability and safety of such transactions as valuable personal data and sensitive information will be sought by them.
So before going for any such loan application it is mandatory to check the credentials of a loan providing site. So the loanee should check the website of the lender precisely and meticulously to find as what are the information provided in the brochure available in the online in that particular website.

There are certain things that one should look primarily in the site for authenticity. First of all there should be a contact information where company full address and telephone contact are given. Do not fall in the trap of some form where they ask us to fill our details but their address and contact number is not seen. One can also do a phone call at the number and just by talking a few minutes one can get a feeling of comfort if they are really the professional ones or just opened a fraudulent site. Then comes the loan details. It is a general tendency of the fraudulent companies not to tell the details about the loan and the charges levied and other information and that will remain as a hidden agenda and will be a problem later on. So if the brochure gives all the charges and consequences of not paying the loan in details and illustrates it transparently then the genuineness of the site can be accepted. Hidden agenda is a sign of malpractice.

Second thing to look for is their testimonials and reviews and that is to be seen thoroughly over a large sample and a few 2-3 reviews or praises about the company will not be acceptable. One more thing is the presence of the company in some reputed sites in form of digital marketing or pop up advertisements which also indicates that the company is established in this business and ready to spend in digital space to showcase its offers. The last thing is do not get stuck with one company and go to the internet and find out some top companies through some reputed search engine like Google and then go through them and compare their overall getup and amount of FAQ and helpful information there. Good companies generally give an elaborate FAQ and help for their products.

Some of the online companies which are in this business of providing loan to the interested persons are PaySense, MoneyTap, IndiaLends, KreditBee, CashE, Capital First Limited, MoneyView, mPokket etc. This is only an indicative list based on their ratings in web portals. There could be many more like that.

Most of these lenders lend the money in the range from few thousands to few lakhs and the rate of interest charged on the loan amount is approximately varies in the range 12 to 36% per annum depending upon the quantum of loan money, type of loan, and the duration of the repayment.

An online loan application is now a normal feature but still one has to be very cautious while doing so. Few precautions one must take are as mentioned below:

1. Make sure that the loan disbursing company/agency/institution is an authentic one.

2. Calls from unverified numbers should not be entertained.

3. Fees are usually not asked for as they get deducted from your loan disbursement amount only, so you have to be very careful when any loan processing amount is asked for online.

4. Frauds are pretty common and to win the trust of a gullible customer these frauds follow all the processes required for loan processing and disbursement and hence anyone can get fooled easily if one is not aware.

5. Mostly for any online loan processes PAN and Aadhaar are mandatorily asked for and after verification of same income proofs like salary slip or bank account details are asked for.

6. Aadhaar is verified from Government authorized Digi locker database and hence one will receive the authorization request to verify the same and if the loan disbursing agency is not a genuine one, they will not be having any such access with them to verify your Aadhaar data and PAN immediately.

If one is going to apply for a loan online, he/she must be cautious and keep in mind the above-mentioned advice and save yourself from fraud and losing money in the name of processing fees.

I would share an incident where I received a call from an agent who offered me a loan and that too with 0% interest. The offer was very enticing and the only rider was that I should buy one insurance policy in the name of the bank amounting to Rs 50000 and the loan amount of Rs 5 lakhs will be disbursed to me once the policy is accepted by the bank.
I had the option to pay back the entire sum in a period of 10 years.

The offer was pretty enticing and the way the other p[erson explained it over the phone was also very convincing, but buying an insurance policy that too in the name of the bank caught my attention. When I asked when this policy is to be taken, I was informed that it has to be taken even before the loan is processed. I asked him to disburse the loan and I will take the policy out of that disbursed amount. Here the other person who was, in reality, a fraud got caught in his own web and disconnected the call after giving an excuse.

So, to be on the safe side you must first thoroughly check the antecedents of the agency or person calling you as there are a lot of frauds happening in the name of loan processing, UPI transactions, cash rewards, etc.

If you really need a loan, then go to the bank directly instead of them coming to you.

Before going into the details, I want to tell you one thing, never go for a loan without a genuine reason. Once you take a loan means you have to pay it back with interest and the total amount you have to pay will be definitely high. So never think of taking a loan just for the sake of taking a loan.
These days the banks are giving very less rate of interest for the money deposited in their banks. Similarly, the rate of interest on the loans they are giving also is on the lower side. So many people are trying to invest in other private finance companies where the rate of interest will be on the higher side. So the loans they give also will charge more interest rate.
Going for a loan to the standard Banks like HDFC, ICICI or SBI is always safe and you will never have any problem. But when you go for various digital platforms where you will not have any information about them. So one should be very careful about this issue. It is reported that India had the highest number of installs for lending apps which will be for getting loans in the Asia-Pacific region in 2020.
Unless otherwise, the lender is not genuine you should not go for those loans. You check for the following.
1. Any genuine lender will have a lot of concern about your repayment capabilities. So they may ask you about repayment history and your credit rating. Genuine companies will first check your credit rating and then only process your application. If any company is coming forward to give you a loan without checking your capabilities, you can doubt their genuineness.
2. Generally, a genuine lender will never pressurise you to apply as early as possible. But if any company is pressurising you to apply quickly and they tell that they will sanction the loan instantly, you can think that company is a fraud company only. A genuine company will not be interested in pressurising somebody.
3. If the company isn't telling the required details like the comprehensive details of the application, appraisal or credit report fees, etc, you should doubt that company. Never apply for a loan to such companies. There may be many undisclosed fees you may have to pay afterwards. Ask them all the details and ask them to send the details on the email and study them carefully before applying for a loan.
4. Visit the website of the loan giving organisation. If it is not secure, you should doubt the company. A padlock symbol should be there on the pages where you're asked to provide personal information. HTTP:// websites are secure.
5. Check for the physical address of the company. If the website is not giving the address of their office, there will be definitely something fishy. They should give their address phone number, preferably a landline number and email address also.
If they are available on the website, try to contact the person on their landline number and talk to the concerned and clear all your doubts. If it is possible to visit their office. Talk to them and see there are no hidden costs. These costs will not be revealed in the beginning and only after you sign an agreement only they will reveal. So you should and get the confirmation.

Before applying for a loan you confirm the following points before you start the process.

A, Check for contact information. Their phone number, email address and physical address should be checked.
B. Read the available reviews about the company online. If the reviews are not good don't apply for the loan from that company.
C. The reviews from various professional websites should be seen.
D. Make sure it has a Reserve Bank of India's (RBI's) license for giving loans.

Loan should be your choice and as per requirement. I suggest do not fall into a temptation to take a loan just because some agency is tempting you with loan promise.
In case you genuinely require a loan for a real need, then you may first approach your bank. Have a discussion with them. If the terms are suitable to you, you may avail loan from them. Alternatively you may shortlist a few credit institutions and get the needed details from them. Then you may decide on an institution taking all essential parameters like interest, charges, security, ease of dealing and ease of remitting repayments, penalty for foreclosure , delay etc.
If it is a genuine credit institution, and the loan is as applied by you, then verifying and ensuring that the site is the official web site of the credit institution, you can submit documents online. You may call and confirm that the uploaded documents are received.
Nowadays many institutions and marketing agencies are sending emails, SMS and even call us promising loans with easy terms. Sometimes we will get message that 'being a special person'(or some such flattering words) we are sanctioned so-and-so amount loan and to contact them with documents to avail the amount. Though on periphery they appear to be very simple and straight, there will be many fine clauses and hidden or disguise clauses, which we come to know only after availing the loan. The actual EMI amount will be much more than what they disclosed.(For example, the tax component may not be disclosed).
So avail a loan when you really need it and when you have the capacity to repay the same smoothly in monthly/regular instalments, the institution is established and reputed, the terms are suitable.

Due to current pandemic a large number of people have lost their jobs and many business have collapsed of many businessmen. Now they are looking for some kind of financial help. There are many fraud companies which are offering loan with attractive packages like high funding and minimum interest rate etc. Thise people who are in need of money urgently are preyed by them. So it's my advice to you verify the credibility of the company before applying for loan.
Some of the precautions may be taken care of:
• Address and location of the company: First, you find out where their office is located and visit the place and talk to them in person. Discuss their policies and read their terms and conditions thoroughly. visit their website too.
• Check the interest rate: Generally, they tell you that they will charge minimum rate of interest like only 5% but reality is that papers which you sign the rate of interest mentioned therein is much higher like 30%. So check how much rate of interest is mentioned in their papers.
• Dont pay them any money: If they ask you to deposit some amount for taking your loan procedure further, don't pay them unless you come to know that the company is not fraud. Preferably, ask them to pay after receiving the loan. Generally, genuine companies don't ask you to pay any loan processing charges and if they charge any fee they will deduct from loan amount when it's transferred to your account. Most likely these companies which charge loan processing fee before paying you loan are fraud.
• Frequent reminders: If you don't show interest in their offer they will call you again and again or they will send you messages with more attractive offers, most likely such company must be fraud. As genuine company have their standard schemes and they don't insist you or pressurise you to take loan from them.
• Verification of documents: Generally, genuine companies don't ask you to take decision in haste or focus on loan processing fee. Rather, they focus on verification of your documents. If your documents are not proper they will refuse to give you loan whereas fraud companies will not pressurise you to complete your documents.
• Asking questions: Genuine company will focus on how you will pay the loan amount back to company. They will check if you may be a fraud for them but fraud company does not get you undergo thorough scrutiny.
• Take opinion: Try to take the opinion of the people who have already taken from money lender. What their feedback is about the company has weight.

All companies are not fraud, some of the money lending apps are in the market which are considered as reliable and credible like RapidRupee, EarlySalary etc.

In this internet age, it has been very easy to seek loan from some agencies with the less documentations. However, during such a process, you would be required to provide some sensitive information to someone unknown to you. Even then, the agency may be talking about some relatively large amount of money to be sanctioned to you in the form of loan. You should consider the following points before considering such loans from online sites. There are some major risks while borrowing online and you need to examine the following points prior to rushing to online loan-
1) Loosing money - Fake money lenders can easily set up shops, promising you quick sanction of loan with less time in the process of sanctioning the loan amount but in reality, they may charge you sorbitant fee for the approval of the loan. The actual amount of loan may remain hidden to you initially but its revelation at the later stage may surprise you.
2) Paying too much - Even if you receive a loan, you might end up paying a lot in the shape of their process fee and interest to a bad lender where as a reputed lender will offer you the same amount of loan at reduced rate of interest.
3) Identity theft- It may happen to you when you enter upon your personal information to their websites and and your informations are hijacked for black mailing purpose. Sensitive informations could relate to your social Security number, date of birth, current and previous address and other personal details.
4) Getting unsolicited phone calls -These calls may appear from block numbers notoriously used in scams. It may appear to you as if calls were made from the local destinations.
5) Could offer you higher amount of loan, though you are not interested- Lenders would be interested to give you loan of largest quantity after confirming your stable income so that they can earn substantially by way of interest.
6) Beware of fake agencies- Beware of such agencies promising you heavy amount of loan but their websites
contain full of spelling mistakes and grammatical errors. Their spokesmen may use abusive words sometimes to pressurize you for availing you of the loan.

By applying for a loan from an online agency, a personal loan of between Rs 5 thousand and 15 lakh is available. Its annual interest rate can range from 12% to 24%. This loan can be given for 5 years. However, the lending limit, interest rate, and duration of different companies may vary.

How to get a loan online?
Asking for information: App companies ask for information like Aadhar card number and PAN online from the person applying for the loan. During this time these companies demand the mobile number which is linked to the Aadhaar card.
Qualification Check: After taking all the information, the company checks the qualification online. If the documents of the applying person are found to be correct according to the company's qualifications, then the loan amount is transferred to the applicant's account within a few minutes.
Qualification scale -Salary, age, credit score, category of the company in which the applicant is employed, activity on social media, education, transactions through a bank account. Different companies may have different scales to check an applicant's eligibility.
Documents - Aadhaar Card, PAN, Mobile Number, Email ID, Salary Slip, Bank Account Number, Bank IFSC Code, Six Month Bank Statement. All these documents should be in JPEG or PDF format. The documents sought may be more or less according to the lending companies. It should be noted that the base and pan should be linked to each other. Also, the mobile number should also be linked to Aadhaar.
EMI - While giving a loan, the company connects the bank account of the applicant to the loan account. For this, agents of some companies come to the home of the borrower, and some sign on the papers. Of these, there is a loan agreement and a bank paper. After this, the EMI of the loan is deducted from the bank account on a fixed date.
These are the rules for not paying EMI on time-
All the lending institutions are required to follow these guidelines of the Reserve Bank (RBI). Know what the lending institutions can do as per RBI guidelines with those who do not repay EMI on time.


Keep these things in mind before taking a loan
- Do not sign any document attached to the reading unread.
Know the complete rules related to recovery.
- Know the rules related to party payment, also from the lending institution. Many institutions charge some for repaying debt prematurely and some at all.