Fintech Unsecured Lending - Facts & Myths

Location Barriers: Instant personal loan apps commit about speedy loan application, approval and disbursal from anywhere, anytime. However, its doesn’t stand to be true for locations where borrowers’ bank accounts are in regional and cooperative banks, which causes issues in loan disbursal and repayment.

Unlimited KYC Authentication: Paperless verification of KYC documents is super convenient for borrowers. Once the loan app is launched and the traffic starts populating in the app, it is difficult to manage the rush when you have a limited database. India is a country with a vast population. When many users submit their KYC details for verification on the loan app, the loan applications are often dropped due to the limited database to stack the KYC details. So, fintech allows unlimited KYC authentication is truly a myth.

Facts

Smart experience better than banks: Fintech has enhanced the level of user experience supporting top end financial services digitally – corporate banking, private banking, crowd funding, trading and lending. Partnering with fintech, digital wallet platforms such as Google Pay, Paytm, PayPal have emerged as an easy source of online payment.

Quality Check: Fintech firms are ideal to derive credit scoring of different borrowers as required by various financial institutions. This analysis of borrower’s creditworthiness simplifies lender’s decision making whether to sanction the loan or not.

Availability of smaller loans: Earlier, taking a personal loan felt like a burden which changed completely after fintech emerged. Now, there are exclusive instant loan apps giving small cash loans up to 1.5lakhs or more within 24hours. Sanction of small cash loans on the same day has supported many individuals and households during financial crisis.
 
Overall, irrespective of the myths and benefits, the fintech unsecured lenders indeed take a risk to offer an easy lending platform with a balanced business model. One that stands true to the borrower’s expectations and practically works in lending money just in the time of emergency.