With the emergence of fintech startups and digitally-driven credit availing systems, loans have now grow to be obtainable with the click of a button, sitting at home. The dependence on digital mediums was additional pushed for the duration of the lockdown.
Ankur Gupta, Founder and CEO, Ruptok Fintech, says, “With the pandemic, people had no option but to transact digitally, especially when it came to small loans with low ticket size. As digital credit availing continues to gain momentum, there are certain things that borrowers must know before they opt for a digital loan.”
Here are some elements to think about ahead of taking a gold loan or private loan from digital lenders:
Checking for the platform’s credibility: Before one chooses to apply for a gold loan digitally, it is critical to conduct thorough investigation on the platforms obtainable and verifying the credibility of the similar.
Gupta says, “The best way to do so is to check for the digital presence of the platform in terms of a credible application/ website, customer testimonials and reviews.” Additionally, one can also verify if the platform is a verified lender registered with the Reserve Bank of India or a companion linked with a verified bank.
Type of loan: Before taking any loan, it is critical to recognize the distinctive kinds of loans obtainable in the industry and which loan will suit the borrower’s specifications greatest. Start by developing a checklist – will it be a quick-term or a lengthy-term loan? How substantially could be the collateral? What are the payment alternatives obtainable? What could be the feasible time of loan disbursement? Experts say it is critical to have convincing answers to these inquiries ahead of signing up for a loan.
Interest Rates: Even even though this is an critical point, professionals say this ought to not be the only issue although taking a loan. However, a borrower desires to verify the interest prices ahead of applying for a loan.
Gupta says, “A borrower must understand the latest market scenarios and fluctuations in these rates. Even though interest rates vary from one platform to another, gold loans usually have low-interest rates, when compared to any other type of loan. When availed digitally, these interest rates may even be lower due to less operational costs involved from the lender’s end.”
Understanding the Scheme: After finalizing a scheme, it is of paramount significance to go by means of each and every clause/situation placed in the agreement to be signed. Experts say, ideally, a great digital lending platform will completely communicate all particulars on the loan with the assist of a devoted loan executive. However, borrowers ought to also nonetheless have total information of the scheme that they are deciding on.
Gupta adds, “When it comes to gold loans, there are two major schemes available with banks – fixed and jumping interest schemes. Platforms or NBFCs may also come up with customized, tailor-made schemes to suit the needs of the borrower or to attract more customers.”
Understanding the payment mechanism and alternatives: When it comes to branchless on the web lending platforms, they typically have versatile repayment schemes and alternatives obtainable. A borrower can opt for an choice based on their desires.
Industry professionals say, when it comes to payments, it is critical to note that a borrower ought to only make transactions to the official accounts registered below the NBFC/Bank/ Partner platform’s name. Payments ought to never ever be made below a loan executive’s name. Online payments are deemed to be protected by most banks given that the payments made are traceable as they can be tracked.
CRM Support: Experts say the comfort of a digitally availed loan ought to additional be aided by a robust and true-time consumer service mechanism. Note that getting reminders on interest payments by way of emails and SMSs is an critical way in which great digital lenders assure communication.
Gupta of Ruptok Fintech adds, “The journey of the borrower, right from the first time they reach out to a platform till the time they have repaid their loan, can be a smooth one provided a good customer support mechanism is in place.”