Payday Loan in India : Eligibility, Benefits and Everything That You Need to Know

Payday loans are modest, unprotected relatively brief cash loans that people take out to cover expenses during the month before their next paycheck arrives. Thus, a tiny amount of money is being lent out in exchange for a lot of money at a very high interest rate (up to between 30 and 50 percent).

Payday loans are designed for members of the working class who struggle to make ends meet and are frequently in financial trouble at the finish of the month. Depending on the lender, these loans must be repaid between 7 to 60 days. The loan is particularly expensive because of its brief duration, urgent nature, and repayment risk. However, many are prepared to accept it simply because of the ease it provides in an emergency. Payday loans are utilised in India for a variety of life events, including loans for weddings, unexpected medical expenses, and paying for school expenses.

Benefits of Payday Loan

Payday loans can be a lifesaver for people who live month – to – month and struggle to cover unexpected needs.

1. Speedy and Simple: This is a rapid loan that is frequently accepted and disbursed in a matter of minutes, saving you the headache of extended wait times.

2. No Credit Background Check: Since the working poor frequently use these loans, there are no collateral requirements or credit checks. This loan is available to anyone, regardless of their financial situation.

3. Minimum documentation : The majority of the time, having a bank account and disclosing a few basic personal and financial facts are the only requirements. Like other loans, it doesn’t need a lot of paperwork.

Eligibility for availing a Payday Loan

 Although the prerequisites to apply for this loan differ from institution to institution, there are a few general eligibility requirements that must be met regardless of the lender. Learn about the requirements for these loans, which are listed in the list below:

1. A borrower must be at least 18 years old.

2. The client must be an Indian national.

3. The person must have a full-time job and a reliable source of income.

4. The borrower needs a running current account.

5. To apply for this loan, the applicant must possess the necessary documentation.

6. The client must have a functioning phone number.

Documents required for availing a Payday Loan

1. Identity documents like a PAN card, an Aadhaar card, a driver’s license, a voter ID card, a passport, etc.

2. Aadhaar cards, passports, voter ID cards, driver’s licenses, ration cards, utility bills, and other documents serve as proof of address.

3. Age proof

4. Income proof

5. letter from the employer’s company

6. Passport size photograph