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Facing cash crunch? Here's how to avail loans for short-tenure


The end of the festive season is always marked by depleted salaries on account of the various shopping and gifting expenditures.

Facing cash crunch? Here's how to avail loans for short-tenure
Authored by Rohit Garg
The end of the festive season is always marked by depleted salaries on account of the various shopping and gifting expenditures. This could prove problematic if one encounters an untoward or emergency expense. While applying for credit cards is an option, it can be a cumbersome process at times.
Especially for the underserved sections of our society, who are often unable to access loans and financial products due to lack of capital and banking credentials. In such a case, customized microloans are more suitable for small-ticket entities as they are easier to avail of.
The current operating models of banks and financial companies often fail to cover the various underbanked segments like small-time vendors, roadside hawkers, etc. who together form the expansive microenterprise ambit of the SME ecosystem. A number of dedicated micro-financing companies are optimizing AI and data sciences for devising cutting-edge lending algorithms. These algorithms help in accurately assessing the lending backgrounds of individuals and granting immediate loans. People who have hitherto been denied access to banking and financial services can now effortlessly acquire these monetary benefits. All that is required is a smartphone and an internet connection.
The pioneering concepts of microfinance and microcredit conceived by the Bangladeshi Nobel Laureate, economist, and Grameen Bank Founder Muhammed Yunus are empowering the underserved sections of society to a remarkable extent. India despite being one of the world’s fastest-growing economies still has a significant population that is bereft of basic banking and financial services. These short-term loan facilities are perfect for those who aspire for small and medium credit features.
While these services allow small and micro-business owners to access loans, insurances and investments that help their businesses grow; the short-tenure loans are also equally well-suited for prospective borrowers from the middle and lower-income segment of customers who seek fast-paced credit services.
They can now seamlessly receive an array of financial services from the comfort and convenience of their homes after registering and identifying themselves on a fintech platform’s app.
There are presently a plethora of personal loan companies operating in the financial ecosystem. Customers who wish to avail credit services should diligently choose their preferred loan company after carefully weighing in the benefits and cons. Different service providers offer a wide gamut of financial products and services and customers should select a product, which is tailored as per their credit requirement.
The rise in digital technology has made applying for loans a simple and hassle-free process. No longer is availing a loan hurdled by paperwork and formalities. These days it is possible to sign up for a loan in a matter of minutes with minimum documentation. Customers can access a vast range of credit services without bothering about legal and procedural formalities. The lenient eligibility criteria for instant loans make for easy and effective credit access.
People who are facing a monetary crunch after spending lavishly during the festive period and require an efficient solution for their financial needs can benefit from the easy approval feature of short-term loans. The instant loan application can easily help in addressing the monetary concerns of people awaiting their next salary as the loan approval process takes very little time. In conjunction with this, the disbursal period is also very less in the case of short-term loans. Users get the money credited within a few hours of their loan-application request.
If that wasn’t all, these instant short-term credit suites also offer payment options that are significantly straightforward and user-friendly. Borrowers can make loan repayments through a finance company’s proprietary app in a simple and streamlined manner. In case a customer is unable to pay off the credit due to personal reasons, they can also be settled through flexible EMI options.
Taking repeated fast loans from finance companies and timely repayment entitles users to enhanced credit scores that can prove instrumental in availing larger loans in the future. With improved credit credentials, users can access greater credit services from lenders in a matter of minutes.
That said, instant credit and loan services are more appropriate than credit cards for overseeing any emergency expenditure. With credit cards, the contingency remains that a user’s purchasing power is restricted to only those who are compatible with the card. This limits a user’s buying potential by a considerable degree by obstructing them from accessing cash. On the other, new-age instant loan apps transfer the money directly into a customer’s bank account that can be effectively utilized, anytime, anywhere.
Fast loans are indeed revolutionizing the lending sector through their simplified access, ease of approval, least amount of paperwork, and uncomplicated repayment abilities. With a comprehensive segment in India subject to various cash-related woes, gaining instant loans is emerging as the favored form of credit service. Not only the underserved segments of the population but even the MSMEs and members of the medium and lower segments of the population are shifting towards instant loan applications, rather than credit services and other financial products.
Rohit Garg is Co-Founder and CEO at Smartcoin. Views are personal
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