Short Term Loans

A loan's duration determines whether it's a short-term or long-term loan. Short-term loans are loans with a shorter repayment period. Short-term loans are typically used to address pressing financial demands.

What Is a Short-Term Loan

A short-term loan is one that is taken out to meet a short-term personal or corporate capital need. Because it is a kind of credit, it entails repaying the principal amount plus interest by a specified due date, which is normally a few months to a year after the loan is availed.

Importance Of Short-Term Loan

There are several advantages of taking out a short-term loan for the borrower like:

2. The funding is quick.

3. It's a lot easier to get.

How Does Short-Term Loan Work

Short-term or personal loans are approved without the use of collaterals such as real estate or other assets. Short-term loan acceptance and reception are typically based on the borrower's credit score.

A short-term personal loan, unlike a regular personal loan, is meant to be repaid within a year, or perhaps a few months depending on the amount. If your loan request is approved, you'll receive a loan offer with a personal loan interest rate and duration.

Why Should You Opt For Short-Term Loan

Short-term loans have a lower ratio of cumulative interest paid to the borrowed amount as compared to long-term loans. So, if your credit standards aren't too stringent and you can afford a larger monthly EMI, you must go for a short-term loan to save money on interest.

Short-term loans are less expensive than long-term loans. As a result, it's simple to repay in EMIs. When EMIs are paid on time, the credit score improves as well.

Important Factors To Consider While Getting Short-Term Loan

Some significant aspects to consider while applying for a short-term loan are listed below:

1. Make sure you have a strong credit history. The lender will look at your previous credit behaviour to establish your repayment capabilities. They aim to ensure that their borrowers have the financial discipline necessary to repay their loans on time.
2. Compare personal loan interest rates from various lenders. Compare the personal loan interest rates offered by different lenders, such as banks, NBFCs, and online loan apps, to get a competitive interest rate on your short-term loan.
3. Maintain a strong credit score. If you have a decent credit score, you'll have a greater chance of getting your short-term loan application approved. Your excellent credit score proves that you are a dependable borrower. A good credit score may also assist you in obtaining a loan with a lower personal loan interest rate.
4. Negotiate with your lender. If you have a solid credit score or a good relationship with your lender, you can negotiate a lower personal loan interest rate. It's best if you submit a formal request for this.

Features And Benefits Of Short-Term Loan

The following are some of the most significant features and benefits of a PaySense Short-Term Loan:

1. Uploading documentation is straightforward thanks to PaySense's easy user interface. PaySense offers a number of EMI plans that are both affordable and flexible.
2. Approvals and disbursements are completed in a timely manner. PaySense approves your loan in two hours or less.
3. PaySense provides swift short-term personal loans to assist you in financing your personal needs.
4. With a simple click, you may apply for additional loans. You'll discover that securing your next loan with the app is much easier and faster once you've done business with PaySense.
5. No credit history is required. PaySense does not require you to have a good credit score to avail a loan with them.

Reasons Why You Should Take Short-Term Loan From PaySense

Here are a few reasons why you should choose a short-term loan from PaySense:

1. Flexible payback: PaySense's flexible repayment options allow you to repay the money without breaking your bank account.
2. Minimal documentation is required: To apply for a short-term loan online, you simply need to provide a few papers.
3. No restriction on end usage: PaySense Short-Term Loan is a loan with no restrictions on final use. As a result, you are free to spend the borrowed money wherever you desire.
4. Low interest rate: PaySense offers short-term loans at an interest rate lower than credit cards.
5. Saves time: You don't have to go to a bank to apply for a short-term loan because you can do it online. You won't have to wait for the loan to be authorised for days. The entire loan application process takes only a few minutes on the PaySense personal loan app.
6. You do not need to put up any collateral to acquire a short-term loan because it is a no-collateral loan.

How To Apply For Short-Term Loan On PaySense

PaySense offers short-term loans with APRs ranging from 16 percent to 36 percent for sums ranging from ₹5,000 to ₹5 lakh. The loan length ranges from three to sixty months.

On the PaySense personal loan app, you may apply for a short-term loan as follows:

• On your smartphone, download the PaySense personal loan app.
• Verify your loan eligibility after logging on to the app.
• KYC documents such as your Aadhar card, bank statement, and others can be used to prove your identity. Upload a picture of yourself as well.
• Sign the NACH form as well as the loan contract.
• Once your loan application is approved, the loan amount will be deposited to your account.

FAQs Section

1. What makes a short-term loan different from a long-term loan?

While repayments for long-term loans might range from a few years to many years, short-term loans are often repayable within a few months to a year. Short-term loans are typically availed for modest quantities of money quickly. On the other hand, long-term loans are typically necessary for greater amounts or for larger transactions, such as the purchase of a home.

2. Why are short-term loans preferable?

Short-term loans are preferable as they have lower overall interest payments since they must be repaid typically within a year. The amount of interest paid with short-term loans is substantially smaller as compared to long-term loans.

3. Long-term or short-term loans: which is better?

Long-term loans can be preferred when you need a greater loan amount at a lower interest rate, and more time to repay the debt. Short-term loans are better as they offer small amount loans with reduced interest rate, making your repayments easier.

4. For how long should you take out a short-term loan?

Short-term loans are so named as they must be repaid in a short period of time. You can take out a short-term loan for a period ranging from three months to a year. PaySense offers short-term loans for a duration ranging from three months to five years.

5. What are the advantages of taking out a short-term loan?

Short-term loans have lower overall interest payments since they must be repaid within a year. The amount of interest paid with them is substantially smaller as compared to long-term loans. Because they are easier to get, the borrower can access the cash more quickly.

6. What is the interest rate on a short-term loan?

PaySense provides short-term loans with APRs ranging from 16% to 36%.

7. What are the types of short-term loans available?

Below are a few types of short-term loans that are available in India:

• Personal loans
• Payday loans
• Lines of credit
• Online loans

8. How can I apply for a short-term loan via the internet?

Take the following steps to apply for a short-term loan:

• Download the PaySense personal loan app on your phone.
• Log in to the app.
• Prove your identity uploading KYC documents such as your Aadhar card, bank statement, and others. Upload a picture of yourself as well.
• Sign the NACH form and the loan contract.

9. Is there any kind of security necessary to get a short-term loan?

No, you do not have to pledge any security to avail a short-term loan.

10. What are the personal loan interest rates on short-term loans given by lenders?

PaySense provides short-term loans with APRs ranging from 16% to 36% on a reducing balance basis for amounts ranging from ₹5,000 to ₹5 lakh.

What is the purpose of a short-term loan?

Both businesses and individuals benefit from short-term loans. They can be an excellent option for firms dealing with unexpected cash flow problems. Individuals can use such loans as a source of emergency finances.