Business Desk – Instant Loan App: In today's time, it has become very easy to take a personal loan when you need money. Many Instant Loan Apps claim to provide loans in no time. But taking a loan from any app in a hurry can be harmful.

While taking a loan, it is not enough to just see how much amount is being received and what is the interest rate. It is also important to check who the lender is, what will be the total cost, what charges will be levied and what permissions the app is asking for.

First of all find out- who is the real lender

Seeing the name of an app, it is not right to assume that the same company is giving you a loan. Many digital lending apps work as Lending Service Provider (LSP) of banks or NBFCs.

Therefore, before taking a loan, definitely find out who is the real lender i.e. bank or NBFC. If an app does not clearly provide information about which bank or NBFC the loan is available from, then be careful.

Do not decide just by looking at the interest rate

While taking a loan, it is not right to take immediate decision after seeing the low interest rate. Along with the interest rate, also check the processing fee, prepayment charge and other charges.

To understand the total cost of the loan, please read the Key Fact Statement (KFS). In this, information about the Annual Percentage Rate (APR) of the loan i.e. annual actual cost and other necessary expenses is available. This lets you know how much the loan will actually cost.

Also see how much money will come into the account

It is not necessary that the loan amount and the amount in your bank account should always be the same. In many cases, processing fee or other charges are deducted from the loan amount itself.

For example, if the sanctioned amount of the loan is Rs 1 lakh and a fee is deducted from it, the amount in your account may be less than this. Therefore, before accepting the loan, definitely check the Net Disbursal Amount i.e. how much money will actually come into the account.

Which permission is the app asking for?

If the loan app is asking for access to more personal information than necessary on your phone, then be careful. Think carefully before giving permission to any app to access your phone, personal data or other information. Do not give permission in a hurry just because you need a loan immediately.

Do not sign without reading Terms & Conditions

It is important to read the Terms and Conditions carefully before taking a loan. Before signing any document or giving digital consent, understand what is written in it. Especially look at the loan tenure, interest, APR, Processing Fee, other charges, rules to prepayment and payment terms.

Haste in instant loan can prove costly

You can get money quickly through instant loan app, but it does not mean that the loan terms will also be easy. Therefore, before applying, please check the identity of the real lender, KFS, APR, all charges, actual amount received in the account and permissions of the app. Instead of taking a decision only on the basis of low interest or quick loan, take a personal loan only after understanding the total cost and terms.