Types of loans that one can avail in India...
Types of loans(Credit)
FINANCE BASICS
Banks in India provide diverse loan options tailored to personal, professional, and emergency needs, helping individuals bridge financial gaps responsibly. These range from collateral-backed secured loans with favorable terms to quick unsecured personal loans for urgent expenses. Choosing the right type depends on your income stability, credit history, and repayment capacity.
Secured Loans
Secured loans require assets like property or gold as collateral, offering lower interest rates around 8-15% and longer repayment periods up to 20-30 years.
Home loans fund property purchase, construction, or renovation, with options for balance transfers to reduce EMIs.
Loans against property allow borrowing up to 60% of asset value for business expansion or large personal needs.
Gold loans provide instant cash against jewelry at rates of 9-12%, ideal for short-term liquidity without selling valuables.
Car or two-wheeler loans finance vehicle purchases, with the asset as security and tenures matching income flow.
Loans against fixed deposits or mutual funds let you access up to 90% of investment value without breaking them.
Unsecured Personal Loans
Unsecured loans skip collateral, relying on salary slips or income proof, with higher rates of 10-30% and tenures of 1-5 years for faster disbursal.
Standard personal loans cover weddings, vacations, medical bills, or debt consolidation with minimal documentation.
Instant or digital personal loans from apps approve funds in minutes for salaried professionals via e-KYC.
Festival or marriage loans offer seasonal top-ups with flexible EMIs during high-spending periods.
Credit card loans convert limits into lump sums at lower rates than cash withdrawals.
Specialized Loans
These target niche scenarios with government support or relaxed criteria.
Education loans finance higher studies, including abroad tuition and living costs, with grace periods post-course.
Business loans under schemes like Mudra Yojana aid startups or working capital for small enterprises.
Medical loans address emergencies or surgeries, often with tie-ups at hospitals for zero upfront costs.
MSME loans provide machinery or inventory funding at subsidized rates for entrepreneurs.
Key Considerations
Evaluate your CIBIL score, compare rates across banks and NBFCs, and use EMI calculators to avoid over-borrowing. Government portals like RBI's Sachet help spot legitimate lenders and avoid predatory offers.