Digital personal loans in India: How safe is 100% paperless lending?

All you need is your smartphone to access most products and services in today’s digitised world. Every possible thing is getting delivered to your doorstep, while important financial services can be availed within a few clicks. The same convenience extends to personal loans. Those days are in the past when the application involved cumbersome paperwork […]

All you need is your smartphone to access most products and services in today’s digitised world. Every possible thing is getting delivered to your doorstep, while important financial services can be availed within a few clicks. The same convenience extends to personal loans.

Those days are in the past when the application involved cumbersome paperwork and long queues. Now, all you need is an internet connection and a smart device. But is it safe? Let’s decode in this informative blog.

How does 100% paperless lending work?

With a paperless personal loan application, the requirements are simplified. The entire journey takes place online with simplified steps:

• Online application form with minimal details

You submit a digital loan application, which requires basic details like your full name, date of birth, address, PAN, etc.  You can apply for a FIRSTmoney personal loan by

1. Entering your details like Name, PAN and Aadhaar linked mobile number
2. Choosing loan preferences including loan amount and EMI plan
3. Linking your bank account for disbursal

• Instant eligibility check

Once you submit the details, lenders like FIRSTmoney personal loans by IDFC FIRST Bank have automated systems in place for a quick eligibility assessment. They offer you an eligible loan amount.

• Digitised verification and approval

The next step is to verify your eligibility with KYC and credit checks, all carried out securely online. If everything looks right, your application is approved in a couple of minutes.

For FIRSTmoney Personal Loan by IDFC FIRST Bank, the digital process requires only your PAN and Aadhaar numbers, and a video KYC where you show your original PAN card. Applicants aged between 21 to 60 years who have a stable monthly income and a CIBIL score of 710 or above can qualify for interest rates starting at 9.99% p.a. on a reducing balance basis.

• Swift disbursal

The disbursal happens within 10 minutes if you apply for a personal loan with FIRSTmoney by IDFC FIRST Bank .

• Consent-based digital records

At every stage, all your acquired details are digitally stored per the RBI guidelines. Hence, safety is regulated.

Why a digital personal loan seem risky?

Even with a simpler and more convenient process, some borrowers may hesitate about opting for digital loans. The concern mostly comes from  the following reasons:

• Fear of data misuse or fraud

News surrounding fake loan apps and data leaks has most people wary of sharing personal details, despite having renowned lenders in the market.

• Instant seems gimmicky

Instant loans are possible thanks to digitised systems, but this may be faced with scepticism. You can appease your doubts by checking if you qualify for a personal loan with a personal loan eligibility calculator.

• Too many platforms

With the increased popularity of personal loans, multiple lenders have entered the market. The multiple apps make it difficult to separate trusted lenders from the risky ones.

• Limited understanding of the process

Due to limited understanding on what goes on behind the scenes with a paperless application, there is a fear driven by inhibitions.

• Lack of face-to-face interaction

When having any queries, speaking to a person may feel safer than interacting with a screen. It provides the immediate human assurance, but digital loans also come with prompt customer service assistance.

How to safely approach paperless lending in India?

Submitting a personal loan application is simpler than you think. As for the inhibitions, you can gain confidence with these safety tips:

• Choose regulated, well-known lenders

Always go with RBI-regulated lenders who have a clear record. Established banks clearly outline their loan terms, data policies, grievance redressal, etc.  You also get prompt support with customer support in case you encounter problems.

Regulated lenders like IDFC FIRST Bank offer FIRSTmoney loans ranging from ₹50,000 to ₹15 Lakh with clear repayment tenures of 9 to 60 months. These include flexible terms such as zero foreclosure charges, allowing you to close the loan at any time through the mobile app.

• Use tools to plan your application

Before initiating the application, you can use a personal loan eligibility calculator to learn where you stand with your financial and credit profile. This gives more clarity on how your application is processed. It also gives you more clarity to compare varied loan offers.

• Read consent messages carefully

With digital loans, you are met with a digital consent prompt at every stage of the application. Take a moment to read through the terms and conditions to understand what you can expect.

• Apply through the official website or app

Always search the official website of the app of the lender to initiate the application process.

Final words

Digital personal loans make funding your immediate financial needs that much easier. You can apply whenever, from wherever, as per your comfort level. If safety concerns are holding back, do a thorough assessment of the lender, their offer, and the loan terms.

Also, use the knowledge about paperless lending to proceed with your future loan applications confidently. As long as you understand the eligibility and apply with trusted lenders, you need not worry about safety with digital applications.