Personal loans in India have witnessed a good rise since the past decade. This trend can be contributed to few factors that have played a good role. Today, anyone can apply for a personal loan with minimum documentation. Banks and NBFCs have streamlined the process in such a manner that makes personal loan as the most popular loan available in India.
Here are the 3 reasons why the personal loan trend has improved in India;
Digitization of personal loans
Earlier, getting a loan was a lengthy process. It could take many weeks to get all the documents and loan approved. In 2019, if someone wants a personal loan, they can begin the process in few clicks that would take less than an hour to do so. It’s become so easy now. We can give credit to Banks and NBFCs as they created an online portal where you can apply for a personal loan.
Increase in financial awareness
A decade ago, people were not financially aware. Our knowledge was limited. But with the smart phone revolution, everyone now can have all the information they need regarding personal finance. With such data at your disposal, people now understand how important investments are. The focus earlier was to take a loan when you don’t have much money. But now, people would opt for a personal loan whenever they need it.
Introduction of credit score system
Credit score has been a revelation. This 3 digit score allows banks to understand if you are worthy of getting a loan or no. Hence people are now focusing on increasing their credit score and would always maintain it so they can unlock the best loan deals. Credit scores above 800 gives you higher chances to get better personal loan deals.