What is a Personal Loan?
Personal Loan is an unsecured loan that is generally used for a personal purpose. This type of loan could be used for paying off debts, going on vacations, buying appliances and latest gadgets, home improvement, unexpected medical expenses, and so forth. The banks calculate the eligibility of the borrower before approving the loan application. A Personal Loan is offered based on the credibility and repaying capacity of the borrower. The funds from a Personal Loan could be used for any type of expense as per the convenience and requirement of the borrower. As a Personal Loan does not require any security or collateral, the rate of interest charged is comparatively higher than other types of loans. Unlike the high rate of interest, the loan tenure is shorter than the other types of secured loans and can be used for any personal need.
Different Types of Personal Loan
There are different types of Personal Loans based on need - for example:
Festival Loans : Loans offered during festival season at discounted interest rates for a shorter period of time.
Consumer Durable Loans : Small loans offered to purchase durable consumer products including televisions, ACs, etc.
Marriage Loan: Loan offered for marriage expenses
Vacation Loan : Loan taken for travel (Domestic and International)
Home Renovation :
Loan for renovating/ upgrading your home
What is an Unsecured Business Loan?
The growth and sustainability of a business depends on the continuous inflow of funds. The funds might be required to expand the business or purchasing equipment. The funds can be borrowed in the form of a loan from banks and other financial institutions. Business Loans are typically unsecured in nature which means no collateral or security is required to borrow a loan. Business Loan is a debt provided to the company or the self-employed professionals or business owners that are to be repaid along with the principal amount. The rate of interest is usually pre-determined by the lending institutions. A Business Loan in India is offered at competitive interest rates, with a low processing fee, and without any security or collateral. Several leading banks and NBFCs including HDFC Bank, ICICI Bank, Capital First, Citibank, Fullerton India, Tata Capital, and so forth are offering business loans.
Different Types of Business Loans
Some types of Business Loans are explained below:
Term Loans: Term Loans could be used for business expansion or capital infusion requirement of an organization. Generally, a term loan is the loan offered for the acquisition of long-term fixed assets including land or building, machinery, and other business needs. The interest rate can be either fixed or floating and are usually have a fixed repayment schedule.
Working Capital Loans: These types of loans are offered to meet the daily operating expenses of the business. These loans can be further classified as secured and unsecured loans.
- Home Loans
- Loan Against Property
- Unsecured Loans
- Vehicle Loans
- Education Loans