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What Is This Fuss About Paperless Personal Loans?

What Is This Fuss About Paperless Personal Loans?

Paperless Personal Loans, The Easier Future

There are already clear indications that November 08, 2016 will go down in the annals of history as the day India took a giant leap in to the world of digital currency. Four months on, the results on the ground are already showing. The endless queues in front of the ATMs have disappeared, the cash crunch has eased and what remains is a nation slowly warming up to the concept of a less cash dependent society. Enterprises, banks and retailers have been at the forefront of this transformation and a lot of economic activities have been shifted to the digital route- personal loans being one of them.

In fact, the concept of paperless documentation has been doing its rounds for quite a while now, but the demonetization has given it a decisive push. Banks and financial institutions have cashed on this sentiment and launched paperless personal loans for customers. Digital personal loans can be applied and sanctioned online without any paperwork.

So how does it work?

Like with most things digital, all you need to go is online and fill up a loan application form and submit soft copies of documents proving your eligibility and supporting your repayment ability. This is submitted digitally to the bank, which in turn processes it, approves the loan limit and credits the applicant’s account accordingly. Now, compare it with the conventional personal loan application route where you have to meet numerous people, submit a list of endless documents, visit the bank multiple times, call them up to check the status and so on!

Paperless personal loans are not to be confused with pre-approved loans as the former still requires the submission of documents online, while the latter is offered considering the personal profile of the customer.

Things to know before you apply for a paperless personal loan

The research part remains the same as with the conventional personal loan. Ideally, you should compare all the major loans on offer, decide on their suitability, fee and charges etc. before finalizing one. Read through the terms and conditions thoroughly to ensure you are not in for any shocks later on.

You should also have the soft copies of all required documents like your PAN card, address proof, ID proof, bank statements, FORM-16, photo etc. ready. Once you have zeroed in on a loan provider, you can go online to the bank’s website or the online loan aggregator’s platform, fill up the desired forms and submit the soft copies of the documents.


Another important thing is to have a sound repayment strategy. Just like the conventional personal loans, the paperless ones also have relatively high interest charges. Since the latter will be disbursed immediately and your repayment liability starts from the next month, you should have a repayment plan in place even before you apply. Defaulting on loan repayments can adversely affect your credit ratings and thus hurt your chances of securing a loan in the future.

Although submitting soft copies of your documents online are safe since most of these banks have state-of-the-art security systems, it is imperative that you have them too. Since most of us use our smartphones and laptops for conducting digital transactions, make sure the antivirus, antispyware & antimalware definitions on your devices are up-to-date.


The concept of paperless personal loans is in sync with the government’s digital push and it also provides the customer a hassle-free, paper-free loan application process. While most of the terms and conditions remains the same as with the conventional personal loans, the idea of not having to meet multiple people, visit the bank numerous times and less documentation is a reason good enough for tech-savvy individuals to take the paperless personal loan route. The banks would do well to cash in on this by making it more attractive in terms of offering discounts or additional benefits for customers who opt for paperless loans.

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