In the current situation, people face financial hardship due to job loss, salary cuts, and the closing down of businesses. Several firms have suffered significant losses or have been forced to close due to the lockdowns, which were unavoidable given the scenario. People are currently experiencing financial difficulties in these times and this has resulted in boosting the market demand for personal loans. Personal loans allow the borrower to meet their financial obligations. This also benefits the creditor in terms of gaining more incredible wealth. A personal loan can be used to fund higher education, home renovations, debt reduction, travel, weddings, and medical emergencies, among other things. To increase demand for personal loans, PSU banks and private-sector lending institutions focus on unsecured loans such as personal loans.
Covid therapy can be costly as it necessitates comprehensive treatment and may necessitate prolonged hospitalisation. However, many people have health insurance to cover the cost of medical treatment. If a borrower has a significant medical emergency such as Covid treatment, personal loans can also be secured online. Suppose an applicant has a good CIBIL credit score. In that case, he can apply for a personal loan online, providing all of his personal, employment, and financial information, as well as the loan amount and repayment period. Agents from the company will contact the borrower, and the loan amount will be disbursed within few days.
Benefits of taking a personal loan during the coronavirus pandemic
A personal loan helps us relieve anxiety and tension caused by difficult circumstances. Still, they also help us increase our ability to obtain a loan in the future by improving our credit scores. However, it is critical to do as much research as possible before approaching any credit lending business for a loan. The processing period is getting shorter as lenders know how critical it is to have money available in a crisis. Personal loans can now be obtained faster than ever before, thanks to the internet transformation of most processes. To receive a personal loan, you need three documents: evidence of income, proof of identity, and address. Your Aadhaar Card may be used to verify your identity as well as provide you with an address. PAN Card, driving licence etc., can also be used etc.
Personal loan interest rates are more often lower than credit card rates. Therefore, many times personal loans are used to pay off credit card debts. Considering all those, we can say that going for personal use is an excellent idea in case of a medical emergency because it does not require any collateral security. A personal loan interest calculator helps us to calculate monthly instalments.
SBI special loan schemes
Many banks launch various schemes in this COVID 19 pandemic to bring relaxation to the economy. To state an example, the State Bank of India (SBI) has introduced the Kavach Personal Credit, a no-collateral loan. As per a press release from the bank, the loan would cover the costs of COVID treatment for the consumer and their family members.Customers can borrow up to Rs 5 lakh under this scheme at an effective interest rate of 8.5 per cent per annum for 60 months, including a three-month moratorium.
.”This one-of-a-kind loan falls under the category of no-collateral personal loans. The scheme will also cover the reimbursement of fees already incurred for COVID-related medical charges, “According to the press release. SBI further said in their statement that the ‘Kavach Personal Loan' would be included in the COVID-19 loan book being prepared by banks by RBI's COVID alleviation measures. SBI personal loan interest rate is 9.60% per annum.
Documents required
Although the documentation required varies by lender, the following are some of the crucial documents you must submit with your application form:
- Proof of earnings like salary slip, bank account statement, ITR forms.
- Proof of residency, as well as proof of identity, are required.
- Authenticated copies of your diplomas and licences only for self-employed applicants .
All these documents are required to apply for a personal loan.
