India is a country where people don’t have enough money to spare. To lead an affordable and comfortable life, most of its citizens take up a low-salary jobs to earn their daily bread. However, taking up a low-paying job has several downsides as well. For example, the income from a low-paying job might not even be enough to cover your basic expenses such as rent, food, and other miscellaneous expenses. Moreover, it makes it difficult for you to save anything at all. Therefore, taking up personal loan offers or a low-salary loan in India is one of the many lesser-known ways that you can increase your savings without having to sacrifice on lifestyle or earnings either. In this article, we will explore the ins and outs of taking a low salary loan in India so that you can make an informed decision about whether it’s really worth it for you!
What is a Low Salary Loan?
A low salary loan is a loan where you take a lower (or lower-interest) amount than the usual limit set by the lending organization. Often, a person taking out a low-salary loan has a relatively lower salary than the others in his/her field. You can also choose to take out a low salary loan to recover your loan payments if you are facing some financial problems. There are a number of online loan apps that offer low-salary loans in India. You can apply for a loan by furnishing your salary details such as the amount, date of payment, and the purpose of the loan. You can also choose to share other information such as your monthly income, your monthly expenses, and your monthly savings.
Pros of Taking a Low-Salary Loan
The benefits of a low-salary loan are
- Low rate of interest – A low rate of interest is one of the major advantages of taking a low-salary loan in India. Most of the online lending websites that offer low-salary loans in India offer a rate of interest as low as 3.2%.
- Loan repayments can be done via salary deduction – With a low salary loan, you can ask your employer/ lender to deduct the loan repayment from your salary. If you are not comfortable with such a system, you can also choose to pay the loan off in one go.
- Easier repayment – Another advantage of taking a low-salary loan is that you can easily repay it. Unlike a high-interest loan, taking a low-salary loan comes with a lower rate of interest and no fixed repayment date.
- Easy access to funds – Another advantage of taking a low-salary loan is that it allows you to get adequate funds as and when you need them. Most of the online lending websites that offer low salary loans in India let you borrow as much as you need as long as you have maintained your account balance.
Cons of Taking a Low-Salary Loan
The downside to taking a low-salary loan are
- Less protection – A low rate of interest is one of the major advantages of taking a low salary loan in India. However, these low rates of interest attract a lot of people who want to take advantage of the situation, and later, these loan sharks try to collect a huge amount from you. Therefore, you need to be extra careful while taking a low-salary loan.
- No guarantee – Another disadvantage of taking a low-salary loan is that it comes with no guarantee. Unlike a high-interest loan, the amount you borrow from a low-salary loan provider is not fixed.
- No security – Some low-salary loan providers do not offer any collateral security. You will be solely responsible for repaying the loan.
- Risky decision – The last disadvantage of taking a low-salary loan is that it is a very risky decision. If you are not financially disciplined enough, you might end up in a lot of trouble.
How to Get a Salary Loan in India?
There are many online loan apps that offer low-salary loans in India. You can log on to the website and fill in the loan application form. When you apply for the loan, you will be required to provide your personal information such as your account number, loan amount, loan duration, and other relevant information. After providing your information, you will be assigned a loan officer who will guide you throughout the loan process. For every loan you take, it’s important that you keep a close watch on your monthly repayment amount because it might change frequently. When you are repaying a low-salary loan, you will have to deduct the entire amount from your salary and repay it to the lending website.
RBI Guidelines for Salary Loans in India
You can only take a salary loan if you have a valid license or a valid certificate that proves your skill set. Moreover, you must have an annual income of at least Rs 5 lakh (for individuals) or Rs 10 lakh (for joint account holders) to avail of such a loan. Read more about the 2022 RBI Guidelines on Short-Term Loans.
It is legal to take a low-salary loan in India. The loan amount you can get from a low salary loan depends on your annual income and the loan amount you apply for. You must inform your employer that you want to take a low-salary loan. Your employer can either let you take the loan or let you repay the loan with a lower salary amount. You can choose to repay the loan in one go. You can also choose to pay off the loan with a lower salary amount. It is possible to get a low-salary loan with a high-interest rate. You can even get a loan that has no interest rate. It usually takes 3-5 working days to get loan approval from the loan officer.
Apply for Loans of upto ₹5 Lakhs easily using your phone or laptop, and pay back on low EMIs