Short-term personal loans are a financial solution designed to provide quick access to funds for individuals facing urgent financial needs. These loans are typically characterized by their brief repayment period, making them an ideal choice for handling immediate expenses or emergencies. Unlike traditional loans with extended terms, short-term personal loans offer a streamlined process to get the money you need quickly, often with minimal paperwork. Understanding the benefits, eligibility criteria, and potential drawbacks of these loans can help you make informed decisions and manage your finances effectively.
What are Short-Term Personal Loans?
Short-term personal loans are given to individuals who require money immediately in order to fulfil some short-term goal. The repayment tenure is 11 months for availing a short-term goal. When you repay the total loan in a shorter period, you are likely to pay a smaller amount of interest. The process of getting the loan is almost paperless and can be done over the internet. The loan amount is disbursed to the bank account of the applicant in a matter of seconds.
How are short term personal loans different from normal personal loans?
The only difference between online personal loans and short-term personal loans is the tenure of repayment. The typical tenure of repayment for personal loans starts from 1 year and goes up to 5 years, whereas, the mandate of repayment of short-term personal loan is just 11 months.
How can one get a short-term personal loan?
If you need a short-term personal loan, then you can get in touch with a number of e-lender over the internet. These companies have come forward to provide for short term goals. All that you need to get a short-term loan from these e-lenders is a smartphone.
Who is eligible for a Short-Term Personal Loan?
The NBFCs analyze the financial stability of a person from his social media profile and digital footprint. Once they are sure about the financial credibility, they extend personal loans to the applicants on a short-term basis. Some of the lenders go through your credit score in order to have a clear picture of financial stability.
What are the Benefits of a Short-Term Personal Loan?
Some of the benefits of a short-term personal loan are as follows:
- Instant approval
- Completely paperless
- Approval over internet
- No credit charges
- Shorter repayment tenures
Is it necessary to link your Aadhar to get a Short-Term Personal Loan?
Aadhar linking is necessary if you wish to avail a certain amount of short-term personal loan. Your Aadhar should be linked with the PAN in order to help banks to grant you loans over the internet.
What is the Duration of Repayment of a Short-Term Personal Loan?
The duration of a short-term repayment will depend on the lender. It keeps on varying from one lender to the other. However, in general, it is dependent on the amount of cash flow. Banks allow you to repay loans even on a daily, weekly or monthly basis. If you think yourself financially capable of repaying the loan in a certain number of days, then you can easily repay it in 30, 60 or 120 days.
How can you Repay the Loan Amount Borrowed in Terms of a Short-Term Personal Loan?
The short-term personal loan is often granted on mobile. The repayment is most of the time done through a bank transfer. You can also pay through cheque. The mode of the repayment largely depends on the lender.
Is there any need for a Collateral Deposit for Availing Short Term Personal Loan?
Banks and NBFCs do not ask for any collateral deposit while approving a short-term personal loan. There is even no need for a guarantor for the loan.
What are the Interest Rates of a Short-Term Personal Loan?
The interest rates of short term personal are 1.5% per month, and it can be 18% per annum. You can calculate the amount to be paid as EMI by the help of a personal loan calculator online.
Read Also: Decoding Personal Loans Charges: Fees, Costs, and How to Manage Them
