Individuals, corporations, and organizations seek financial assistance for a myriad of reasons, prompting them to turn to lenders. While the requisites for borrowing often demand specific assurances, trust emerges as a paramount factor in certain scenarios. A loan, comprising the loan amount, interest rate, and repayment timeline, forms the crux of this financial transaction. In this realm, both non-banking financial companies(NBFCs) and banks stand out as paragons of trustworthiness, grounded in their reputable status and adherence to stringent government regulations.
Although numerous NBFCs now offer loans, comprehending the intricacies of these financial arrangements is imperative before making a selection. Rewinding a few decades, obtaining a loan meant navigating within the limited options of banks or resorting to individual moneylenders. The landscape transformed significantly with the advent of NBFCs, ushering in a plethora of choices for borrowers. In navigating this altered financial terrain, the pertinent question arises: Should one opt for a loan from a fintech NBFC? Let’s delve into this inquiry to discern the most fitting financial institution for your lending needs.
What is a Fintech NBFC?
An NBFC, or Non-Banking Financial Company, stands as a distinct financial entity, separate from traditional banks, yet wielding a pivotal role in the financial landscape. While not a banking institution, an NBFC plays a crucial intermediary role by offering a diverse array of financial services that mirror many functions performed by banks. One of the primary functions of NBFCs is the facilitation of lending. Similar to banks, they extend loans to individuals and businesses, acting as a source of financial support for various needs. Additionally, NBFCs provide credit facilities, enabling borrowers to access funds for specific purposes with tailored repayment structures.
Benefits of NBFCs
Beyond lending, NBFCs engage in investment activities, allowing individuals and entities to invest their capital in a range of financial instruments. This includes facilitating the purchase of shares, stocks, debentures, bonds, and government instruments, thereby broadening the scope of investment opportunities for their clients. Top NBFCs in India also contribute significantly to the growth of businesses by providing essential financial services. They play a pivotal role in enabling firms to engage in hire purchase, allowing for the acquisition of assets through installment payments. Leasing services offered by NBFCs provide businesses with the flexibility to use assets without the immediate financial burden of ownership.
In the realm of venture capital financing, NBFCs emerge as catalysts for innovation and entrepreneurship. By investing in start-ups and promising ventures, they contribute to the development of a dynamic business ecosystem. This not only fosters economic growth but also encourages the spirit of innovation within the entrepreneurial community. NBFCs also extend their financial expertise to the housing sector through home financing services. By offering loans and mortgage facilities, they empower individuals to fulfill the dream of homeownership. This, in turn, stimulates the real estate market and enhances societal well-being.
In the domain of risk management, NBFCs make insurance services accessible to a diverse clientele. By providing insurance options, they offer protection against unforeseen events, ensuring individuals and businesses can navigate challenges with financial resilience.
Benefits of Taking a Loan from a Top NBFC in India
Taking a loan from a top NBFC in India such as Kinara Capital, rather than a bank, has various advantages for you as a borrower. Let’s take a look at the benefits of NBFCs:
Affordable Financial Solutions: Private NBFCs often offer lower interest rates due to fewer regulations and efficient operations, making NBFC loans and deposits more affordable. They also provide flexible repayment options tailored to individual needs.
Specialised Financial Services: Private NBFCs focus on specific areas like MSME loans, housing finance, and vehicle financing, leveraging their expertise to offer reliable financial solutions. They also provide innovative options like peer-to-peer lending and digital platforms.
Enhanced Privacy and Confidentiality: Private NBFCs prioritise customer privacy and confidentiality, maintaining a smaller client base and ensuring discretion in their operations. This makes them a good choice for clients who value financial privacy.
Promoting Financial Inclusion: NBFCs play a crucial role in financial inclusion in India by using technology to make financial services accessible to those excluded from traditional banking. With web applications, mobile payments, and instant verification, they offer convenient and user-friendly financial solutions to a wider audience, promoting financial inclusion.
Excellent Customer Care: Customers receive superior service from top NBFCs in India during and after the loan approval and distribution stages. With NBFCs like Kinara Capital, borrowers can check the status of their loans and set up reminders for when their payments are due.
Fast Processing: For evaluation, most banks are bound by Reserve Bank of India’s legacy procedures, rules, regulations, and guidelines. They use a set of guidelines to analyze your eligibility, documents, and creditworthiness before finally approving and disbursing a loan to the customer. It can take up to two weeks to receive your funds in your account.
Top NBFCs in India, like Kinara Capital. on the other hand, are recognized for expediting loan processing and approvals since they have more leeway with the rules. If a customer meets all of the loan conditions, an online Kinara Capital loan can be disbursed within 24 hours.
New-age Decisioning: A borrower with a low credit score is usually turned away by banks, and his or her loan application is denied, further lowering the credit score. These borrowers can, however, obtain loans from a leading NBFC in India, such as Kinara Capital, which use new-age loan decisioning models to deliver their services to the last mile.
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Eligibility Criteria to Borrow From a Leading NBFC in India
The following are the general NBFC Loan eligibility criteria. Keep in mind that they may vary depending on the lender.
- You must be at least 21 years old to be eligible for a loan.
- The loan’s maximum maturity age shall not exceed 60 years.
- Salaried employees of government agencies, commercial firms, and multinational corporations are eligible to apply.
- Self-employed individuals can apply for a loan as long as they match the income requirements of the top NBFC in India.
- At least one year of work experience is required in most cases.
- NBFC loans are only available to Indian residents.
Conclusion
NBFCs are gaining ground by offering individuals attractive rates, as banks have a reputation for their low-interest rates. NBFCs are a fantastic option if you need money quickly and with minimal hassle. The needs and requirements of each individual vary. Some people want a faster loan approval, while others want a higher loan amount and superior customer service. Based on your needs, you must select a lender and a product.
Many of these advantages, as well as many others, can be obtained by applying for an online business loan from Kinara Capital, a leading NBFC in India, which provides reducing rate loans up to Rs. 30 lakhs to meet your short and long-term financial needs. Kinara Capital offers a variety of business loans and flexible payment plans that are easy to apply for online and do not require collateral.
FAQs
- Why is NBFC better than a bank?
NBFCs often provide quicker loan approvals and more flexible eligibility criteria compared to traditional banks, making them more accessible for individuals and small businesses.
- Why do people prefer NBFC?
People prefer NBFCs due to their faster processing times, lenient credit requirements, and innovative financial products tailored to diverse customer needs.
- Is it okay to take a loan from NBFC?
Yes, it is safe to take a loan from a reputable NBFC, as the Reserve Bank of India regulates them and offers competitive interest rates and flexible terms.
- What documents are required for a loan application with a Fintech NBFC?
Typically, a loan application with a Fintech NBFC requires identity proof, address proof, income proof, bank statements, and sometimes a credit score report.
- What are the interest rates for loans from fintech NBFCs?
Interest rates for loans from Fintech NBFCs vary based on the loan type, borrower’s credit profile, and market conditions, generally ranging from 10.99% to 36% per annum.
