Owing to the ease of access, substantial loan amount and prolonged tenor, personal loans are turning into favourable finance options for many individuals.
The personal loan domain witnessed a growth of 20.4 % between 2017 and 2018. These collateral-free loans have no end-usage restriction, and the amount can be used for serving various personal and professional needs.
Additionally, financial institutions and NBFCs offer Flexi personal loans to lower your EMIs and save you money. The Bajaj Finserv Flexi Loan is one such advance option that offers you with multiple benefits.
What is a Flexi loan?
Also known as Flexi personal loans, these are types of advances availed to meet your immediate financial requirement. Under this, a pre-determined credit limit is disbursed to your account, and you can make use of any amount as required throughout your loan tenor.
Interest is calculated for only the amount withdrawn and not on the total principal amount. As and when you repay the amount withdrawn, the application of interest will be stopped.
Flexi loan vs personal loan- what is the difference?
Personal loan – Being a regular term loan, you are required to meet its eligibility criteria and documentation process after which you can apply. After your application is approved, the sanctioned loan amount will be transferred to your account directly.
Your EMIs starts after one month from the date of disbursal. Your EMIs has two components- principal amount and interest. The EMI amount will remain constant throughout your loan tenor.
Flexi loan – You are required to meet its eligibility criteria and submit some specific documents to apply for a Flexi personal loan. You get a pre-determined or pre-approved limit that is transferred to your account.
You can withdraw any amount from your pre-set limit at any time from anywhere. Also, there are no restrictions on the number of withdrawals, and you can use your amount as and when required.
You can opt to pay interest-only EMIs with your Flexi loan for the initial tenor. Your interest is calculated only on the amount utilised and not on the entire principal amount.
You should know the difference between both the advances to know flexi personal loans vs term loans, which lower your EMIs. Let us understand the difference with an example.
Example 1 – Personal loan
Suppose your loan amount is Rs. 15 Lakh availed for a tenor of 48 months at an interest rate of 14%. The calculated EMI will be Rs. 48,750 (including principal and interest) throughout the tenor. The interest rate will be calculated on the principal amount irrespective of the amount you use.
Example 2 – Bajaj Finserv Flexi Loan
Let us consider the amount of the above example, now suppose you use Rs. 5 Lakh out of the total amount. The interest rate that you are required to pay for 30 days is Rs. 5,833. To make the most out of your Flexi loan, you can repay your withdrawn amount (Rs. 5 Lakh) at the earliest to avoid accruing interest on it. However, you can repay the withdrawn funds even at the end of the tenor.
With Flexi Loan, Bajaj Finserv also brings you pre-approved offers to reduce the hassle of the application process. You can take a look at your pre-approved offer by sharing minimal details like your name and phone number.
To avail, a Bajaj Finserv Flexi Loan your must be 23 to 55 years of age and should have a stable source of income. Besides, only a resident of India residing in any city where the lender operates is eligible to apply.