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Just around a decade ago, people used to pick personal loans as the eventual alternative to cope with their financial crisis, but today, it’s one of the most performing means of consumer lending in India. In spite of the global coronavirus pandemic, they have upsurged.

As per the recent notified data by the Reserve Bank of India, personal loans covered the largest portion of the total credit extended in India in the previous financial year.

The pandemic impacted negatively to almost every credit segment, although, personal loans were on a separate edge, they attained an impressive and imperative spike.

In this blog, you will figure out the imperative aspects of the upsurge in personal loans in India. Let’s check them out now!

Reasons for a notable spike in personal loans in India

There are certain reasons why besides every other type of credit, personal loans have been emerging constantly in India. The core reason behind the considerable rise in the demand for personal loans are as follows:

• People lost their sources of income due to pandemic.
• Personal loans were comparatively easy to avail than other types of credit forms.
• Personal loans can be availed without promising any asset against them.
• Personal loans come with flexible repayment options.
• Personal loans are offered widely so can be chosen as per one’s needs.
• Both; small-ticket and big-ticket fund facilitation can be availed through personal loans.
• Personal loans can be accessed instantly.
• Personal loans can be taken in use for almost any personal purpose.

The upsurge in the demand of personal loans in India - Facts

Here are some of the vital facts and figures on the constant rise in the demand of personal loans in India:

• As per the recent data of the Reserve Bank of India, personal loans hold 28% part of total bank credit.
• In 2020, over 90% of people who searched out for fund facilitation from a bank turned around personal loans.
• As per the report of an Indian digital entity, millennials’ preference for fund facilitation in times of medical emergencies have witnessed additional turns towards personal loans as compared to previous years.
• Personal loan origination balances witnessed a notable spike in 2020.
• As reported by Transunion CIBIL, even though, the demand for personal loans is constantly upsurging, moneylenders prioritize to keep away from these sections because of asset quality issues.
• The latest research signified that the inability of certain consumers to pay off their debts post end of their moratorium span is likely to boost the prospect of default and negatively affect their credit scores.

Leading personal loan lenders in 2022

There are many reliable and notable moneylenders available in the Indian financial space including banks, NBFCs, and fintech lenders who stand out to offer the best personal loans. Although, there are certain lenders who constantly remain on top. Here we have mentioned a few out of them that you can consider to avail personal loans in 2022:

HDFC Bank

HDFC Bank is constantly leading the lending space as it extends personal loans up to Rs. 40 lakhs without taking any collateral from the borrower. The bank offers loan amounts at appealing rates of interest alongside flexible repayment options.

State Bank of India

The largest bank of India remains consistent in leading the personal loan space. The bank is the only lender in India that offers personal loans with the repayment option of up to 6 years (72 months). Additionally, the bank offers personal loans at a low-interest rate.

Afinoz

Afinoz has also emerged notably in the personal loan segment. The instant personal loan app allows you to compare multiple lenders’ offers in one place and apply instantly accordingly. You can avail of the loan from the app at any time at your ease.

MoneyTap

MoneyTap particularly offers personal loans and is constantly leading the personal loan space. The app enables you to avail personal loans instantly.

Likewise, there are many other lenders, however, the aforementioned apps are some of the leading ones. Although, if you are seeking appealing offers and flexibility, you can head towards fintech lenders such as Afinoz, MoneyTap, EarlySalary, KreditBee, etc.

Benefits of availing personal loans in 2022

If you are wondering to take out personal loans in India and pondering if it is a good choice, take a look at its core benefits that you can enjoy:

• It helps save time
• It can be accessed anywhere at any time
• The entire process is carried out digitally
• Easy to meet eligibility criteria
• Require minimal documentation
• Multiple offers to compare
• Instant access is available

The out-turn

In a nutshell, today not only in India but also around other parts of the world, personal loans have changed their picture as the leading source of fund facilitation in times of financial emergencies.

It is a financial product that has been hovering around forever and now growing fastly. It has altered itself notably to new adaptations. The sector will get advance constantly.

Although, the most significant reason for the spike in the notable rise of personal loans in India is the coronavirus pandemic as due to this multitude of people lost their job which led to the loss of income.

Whether it is economically or physically, there is a below 1% segment throughout the nation and even around the globe which has not been impacted by this pandemic.

Almost everyone has got financially hit. People looked out for several credit options and personal loans were chosen by over 90% of people out of those who searched stringently a banking product.

This led to an upsurge in the demand for personal loans in India. Due to rising demand, moneylenders observed and came up with appealing offers; every lender tried to compete with others in offering extra luring offers.
If you are still seeking for instant loan app, you can also download the Afinoz instant loan app from the Google Play Store, compare multiple personal loan offers of different lenders and apply accordingly.