Need ₹5,000 fast? Fintechs now offer instant loans via Aadhaar
What's the story
Fintech lenders and non-banking financial companies (NBFCs) have made personal loans easier to get in recent years. You can now avail a small loan of as little as ₹5,000 online through Aadhaar-based eKYC. The process is simple and usually involves instant approval with same-day credit disbursal. Your Aadhaar card serves as identification and address proof, eliminating the need for multiple documents.
Application
Eligibility criteria and application process
To be eligible for these loans, you usually need to be over 21 years old, have a stable income source, and a valid Aadhaar number linked to your mobile. The application process starts through mobile apps or websites. After entering basic personal details, your PAN and Aadhaar details are verified via OTP. If your credit history and income meet the lender's requirements, approval is given within minutes, with funds directly credited to your bank account.
Loan terms
Higher interest rates and short loan periods
While small loans are easy to get, they come with a higher interest rate, between 15% and 36% per annum, depending on your credit score and the lender's lending policy. The loan period is usually short, between three to six months. Even missing EMIs on a small loan can hurt your credit score, so it's important to borrow wisely and repay on time. Most websites offer auto-debit facilities for convenience.
Alternative
Use these loans as temporary solutions
For those without credit cards or regular bank loans, Aadhaar-based instant loans are a better option than borrowing from unregulated moneylenders and payday lending stores. However, these should only be used as a temporary solution and not as a regular borrowing method. If you find yourself needing such credit regularly, it may be time to reassess your spending habits and budget.
Credit building
It can help you build your credit history
A ₹5,000 loan can help you build your credit history if used wisely. Lenders report repayments to credit bureaus, which could help you secure larger loans in the future. However, it's important to borrow only what you can repay on time for maximum benefit. Most apps offering these loans require both Aadhaar and PAN for verification purposes, as PAN helps determine your credit score.