A loan on Aadhar card is the next big thing in the financial service sector that is challenging the use of credit cards for cash withdrawals.
However, getting a loan sanctioned based on a credit card and a loan sanctioned using Aadhar are two separate and entirely different concepts.
With a credit card, one can right away get a loan sanctioned. However, getting a loan disbursed with just an Aadhar card is not feasible. It serves the requirement of fulfilling the KYC requirements only. It is therefore required to submit other documents to establish your creditworthiness for getting a loan sanctioned.
Ease of Process with Aadhar Card:
Aadhar Card is a Government-issued unique ID for every individual in the country. This unique ID helps verify your age, address, and identity, which was done through multiple ID cards such as PAN, Voter ID, and driving license. Therefore, Aadhar serves to be the one-stop destination for your KYC. On submission of Aadhar, and in case the same is linked to your PAN card and Bank account, you need not submit any further details to the lender. It serves all your KYC compliance requirements. If an Aadhar is not linked to a PAN/ bank account, such additional information must be published to the lender.
A personal loan may be availed to serve your emergencies such as payment of school fees, insufficient funds for an EMI, or any medical requirement. There is no restriction regarding the need for which one may opt for a personal loan. Earlier, as requested by the banks, many documents were submitted for verification purposes. With Aadhar, the processing time has declined since E-KYC is feasible, which can be done on submission of the Aadhar and backend verification by the lending team. In addition, you can submit a copy of the Aadhar at the office while requesting a loan sanction.
How to avail of an instant loan on an Aadhar card?
Here are the points to note before applying for an instant loan on Aadhar.
1) Submission of documents:
The following documents are required to be submitted:
- PAN card – in case the same is not linked to the Aadhar card
- Proof of address – Electricity bill/ telephone bill may be submitted
- Photographs (recent photo is preferable)
- Income tax statements for the last two years
- Challan of advance tax paid
- Form 16 – in the case of salaried employees
- Bank statements for the previous six months
- Income statement – for nonsalaried loan requisitioner
Note: Govt has not yet issued any notification stating an Aadhar Card to be a proof of address; hence submission of relevant documents to establish proof of residence is mandatory
2) Eligibility criteria:
For availing personal loan on an Aadhar card only, you would need to fulfill the below-mentioned criteria:
- One should be a resident of India
- One should be working with a Public/ Private company or MNC
- One should be between the age of 21 to 55
- Minimum salary requirement also exists (minimum salary of 18000 for metro cities and 15000 for non-metro cities)
- One should have a good credit score (general recommendation is beyond 750)
Eligibility criteria are imposed to ensure assurance of recoverability from the requestor and enhanced monitoring for the lender.
Why should one opt for a loan with Aadhar card?
Here are a few advantages of opting for a loan with an Aadhar card that makes it lucrative:
- Loan processing time crunches since the aadhar card loan applied online
- Acts as a single document for verification of your age, identity, and citizenship
- It makes the documentation process hassle-free
- The verification process is done online without the need for submission of any physical documents
Winding-up
With the advent of technology, the world has come closer, and processes have been simplified a million times. Gone are the days when people spent hours together standing in a queue at banks to get their loans processed. Now, the same can be done with the click of a button without needing to visit the bank, and funds are credited right into your bank account.
Aadhar loan is the next big revolution in the financial service sector. Loan processing, documentation, and interest rates will undergo significant changes in the coming days to make them more user-friendly, digitized, and affordable.
FAQ:
Here are some frequently asked questions about loans on Aadhar cards:
1) Can I get a loan disbursed with just an Aadhar card?
Yes! Aadhar is one document to establish your proof of age, identity, and citizenship. No other document would be required to establish age/ identity.
2) Is it required to submit a PAN card?
If the Aadhar card is linked to the PAN card, then there is no need to submit a PAN card separately. However, if the linkage is not done, then submission becomes mandatory.
3) Is a credit score of 650 sufficient to get a loan sanctioned?
Generally, a credit score of 750 or above is recommended for loan approval; however, some institutions may approve for a lower score subject to higher interest rates
4) How much money can I get through an aadhar card loan?
The loan disbursal amount depends on your income statement/ salary slips and credit score. There are no specific limits imposed on loans disbursed based on the Aadhar card
5) Can I get a loan using a PAN card with no Aadhar?
Not really! Currently, Aadhar is only recognized as eligible proof of identity for issuance of the loan; therefore, PAN, along with Aadhar, is mandatory to get a loan sanctioned
6) Can I get a loan sanctioned without a salary statement?
Yes. In the case of employees, it is recommended to submit a salary statement. However, in a case where a requester being an employee is unable to submit salary slips, he can opt for the submission of bank statements along with a reasonable credit score
7) How many days does it take to sanction an aadhar-based loan?
With an Aadhar card, the verification process happens online, leading to a lower turnaround time for sanction. Generally, 2-3 working days would be sufficient for fund disbursal.
