When it comes to taking a personal loans, business loans, or vehicle financing, most people immediately think of banks. But there’s another option that has gained popularity recently NBFC loans. Non-Banking Financial Companies (NBFCs) are transforming the lending process with their digital-first approach method and quick loan approval. In this article, we will share with you all important information you need to know about what NBFC loans are, how they work, what the eligibility criteria are, and how they compare to traditional bank loans.
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What is an NBFC?
NBFC stands for Non-Banking Financial Company. They are special institutions registered under the Companies Act, 1956 and provide financial services similar to banks like personal loans, business loans, and vehicle financing options to common individuals. However, NBFCs do not hold a banking license. That means:
- They cannot accept savings or current deposits.
- They cannot issue cheques.
- They are regulated by the Reserve Bank of India (RBI).
NBFCs have become especially useful for people with limited credit history or those needing quick funds.
Top NBFC Loan Apps in India
Many NBFC Loan Apps in India offer Fast borrowing and good user experience through mobile apps. These Android apps allow you to check loan eligibility, upload documents, and track loan status easily.
Popular NBFC Loan Apps:
| NBFC Name | App Available | Loan Type |
|---|---|---|
| Tata Capital | Yes | Personal, Business |
| IIFL Finance | Yes | Personal, Gold |
| Aditya Birla Capital | Yes | Personal, Home |
| Mahindra Finance | Yes | Vehicle, Business |
| HDB Financial Services | Yes | Personal, Consumer |
These NBFC Loan Apps in India offer loans of up to ₹50 lakhs, with processing times as quick as a few minutes.
NBFC Loan Interest Rates
NBFC loan interest rates is different for each depending on the lender and the borrower’s Financial profile. While some NBFCs Apps offer interest rates as low as 10% per annum, Some others may charge up to 45% per annum, especially for high-risk borrowers.
Factors Affecting NBFC Loan Interest Rates:
- Credit score
- Monthly income
- Type of loan
- Loan amount
- Repayment history
Always compare these interest rates and check for hidden charges, processing fees, or prepayment penalties when you apply for NBFC Loans.
NBFC Loan Eligibility
Eligibility criteria is different for every lender, but NBFCs Loans are generally more lenient than banks while giving money for lent.
Basic Eligibility Criteria:
- Age: 21 to 60 years
- Employment: Salaried or self-employed
- Minimum income: ₹15,000–₹25,000 per month (varies by lender)
- Credit score: Flexible; many NBFCs consider low or no credit history
Benefits of Choosing an NBFC Loan
- Flexible Eligibility:
NBFCs often accept applicants with lower credit scores or limited credit history. - Fast Processing:
Many NBFCs approve and disburse loans within 24 to 48 hours. - Minimal Documentation:
Digital-first platforms mean fewer documents and hassle-free application. - Wide Range of Loans:
From business and personal to rural loans, NBFCs cater to diverse needs.
Who Should Choose NBFC Loans?
NBFC loans are ideal for:
- Individuals rejected by banks
- People needing emergency funds
- Freelancers or gig workers with irregular income
- Residents of small towns with limited banking infrastructure
Safety Tips When Using NBFC Loan Apps
- Always check if the NBFC is registered with the RBI.
- Read user reviews and app ratings before downloading.
- Avoid apps that ask for unnecessary permissions or upfront fees.
- Enable two-factor authentication on your financial apps.
- Never share your OTPs or personal financial details.
FAQs About NBFC Loans
Q1: Are NBFC loans safe?
Yes, if you borrow from an RBI-registered NBFC and follow security practices.
Q2: Can I get a loan from an NBFC with a low credit score?
Yes, many NBFCs offer loans to borrowers with low or no credit history.
Q3: How long does it take to get an NBFC loan?
Loan disbursal can happen within 24 to 48 hours, sometimes even within minutes.
Q4: What documents are required for NBFC loans?
Basic KYC documents (Aadhaar, PAN), income proof, and bank statements.
Q5: Where can I compare NBFC loan offers?
You can use platforms like the Moneycontrol app to compare loan offers from multiple NBFCs.
Final Thoughts
NBFC loans offer a fast, flexible, and easier Money Loan solution compared to traditional bank loans. With digital apps providing quick approvals, and many online loan options, they are becoming a mainstream choice for many Indians Citizens. However, always do your research, check by checking for hidden fees while using such loan apps, and make sure you’re borrowing from a registered and trustworthy NBFC App or service provider.