Crucial reasons why availing personal loan from a lender is better than borrowing from friends

Are you one of those who are short of cash and do not know where to avail funds to mitigate your financial requirements? The default option for most individuals is to resort to availing of instant funds from pals or family. However, this puts a lot of burden on personal relations, and it is advised to keep your relations and financial affairs separate.

In such cases, in place of asking your friend for monetary help, you can reach out to the financial institutions for applying for a personal loan. A personal loan works well as an excellent financial instrument for borrowing funds to mitigate various requirements, including home renovation or repairs, debt repayment, wedding expenditures, medical bills, or travel costs.

Taking up a personal loan through Earlysalary and Mpokket is a hassle-free and quick affair. With such digital avenues offering personal loans, it has become easy to avail of loans at a competitive interest rate of a loan amount of up to Rs 5 lakh on the same day of applying for a personal loan.

Reasons to select personal loan through Earlysalary and Mpokket over-borrowing from family and friends.

Transactional transparency

Unlike personal loans, unorganized borrowings are not equipped with precise and clear terms and conditions. There is zero clarity on what transaction is, or terms are. It might result in you not meeting the advance in the correct manner and feeling embarrassed or helpless. It is massively possible to get rid of such occurrences by taking up personal loans from a trustworthy institution like Earlysalary or Mpokket that communicate all the terms and conditions linked with personal loan upfront.

Predefined repayment schedule

Personal borrowing generally revolves around unspoken agreements where the repayment terms stay silent. You either end up repaying instantly or, in most cases, forget to repay the borrowed amount. Availing personal loans, on the other hand, saves you from this trouble because you are highly informed regarding your repayment schedules and EMI amount repayments.

Zero hampered relations

When you avail of personal loans from friends and family, borrowing usually is interest-free in nature. It means that your near and dear ones do not earn anything from this arrangement. It may happen in the future that they regret lending their substantial money or require money themselves in future and demand some unreasonable amount in the form of interest or might ask for the amount given back.

You would never ever want your relations with friends and family to fall apart owing to financial misunderstandings, which is the reason why taking up a personal loan is a better decision.  

Legally binding

A personal loan gets disbursed based on your legal signed agreement between the borrower and financial institution. Borrowers cannot be propelled to abide by the terms and conditions outside the legal contract. Unlike this, in the case of zero written contract, when funds are borrowed from family and friends, this may put you at tragic risk. Avoid being in such situations by opting for Earlysalary or Mpokket, where you can get instant disbursals at minimal documentation that involve ID proof, selfie, and address proof.

Free from any obligation

Availing immediate funds from family or friends keep you indebted for long after despite complete repayment of funds. You are consistently reminded about the favours that they did, which means you require helping them all the time when they need assistance. Elimination of such obligations is easy by availing of personal loans from banks, NBFC or digital lenders.

An insight on personal loan

What is a personal loan?

A personal loan in India is nothing but an unsecured credit option offered based on your past credit background and potential to repay it from your salary. Also, it is known as a consumer loan. As the name suggests, it can be availed for meeting personal needs, i.e., it is a multipurpose credit option available quickly to meet your instant financial requirements or monetary crunch.

Do you want to renovate your home? Or do you look to fix a car or require some funds for vacation or wedding? A personal loan through Mpokket or Earlysalary is the best option in all such cases, which makes it a reliable avenue to source your fund mismatches. As the personal loan is a kind of unsecured option, the Personal Loan Interest Rates  in India is usually higher as compared to a car loan or home loan. Hence, you must know your finances well in advance before opting for it.

When can you avail of a personal loan?

As it is a multipurpose loan option, there is zero fixed time to avail of the personal loan. Note that you can avail of a personal loan for meeting any of your requirements.

A few of the reasons for personal loan application include:

∙       To fund festive needs or celebrations

∙       Vacation or holiday financing

∙       Fund wedding or marriage

∙       Renovate or build a home

∙       For medical exigency

∙       Refinance home loan

∙       For fixing your car

∙       Funding higher education costs

∙       For business expansion

∙       For debt consolidation and various other reasons

Thus, a personal loan is one of the preferred financing options to meet your instant requirements. Approval of a loan is easy and quick. Moreover, documentation requirements are minimal.

What are the benefits of an availing personal loan?

Here are few of the most crucial benefits of availing personal loan:

∙       No collateral or security required: As it is an unsecured credit option, there is zero security or collateral requirement of assets of any kind. It is offered based on your repayment capacity and credit history.

∙       Minimal documentation: Many ​abhor taking up personal loans owing to the lengthy documentation procedure. However, personal loans are approved with minimal documentation.

∙       Quick loan disbursement: Nowadays, it just takes a few hours for the loan disbursement. Banks or NBFCs feel that you have the potential to repay the loan in the stipulated time and require a loan for personal reasons and thus disburse the loan as soon as possible on reviewing your minimal documents and other crucial parameters.

Personal loan – A pragmatic protection against financial exigencies

As per the rating report by CARE, the growth of the personal loan segment was 11.9 percent more in July 2021 than in July 2020. Mpokket and Earlysalary alone have successfully disbursed thousands and thousands of personal loans in the course to lend a helping hand to the multiple households.