Key Features | Personal Loan | Loan against PPF |
Definition | Short-term unsecured loan | Short-term unsecured loan |
Repayment Option | Flexible repayment ranging between a few months – several years | The loan should be repaid within 3 years of sanction |
Purpose of loan | No restrictions on utilization of funds | No restrictions on utilization of funds |
Eligibility | Both salaried and self-employed individuals are eligible | All individuals with a PPF account can avail loan based on certain conditions |
Approval Process | Instant Approval within a few hours | Loan available from 3rd to 6th year of PPF account opening, and approval involves certain procedures. |
Amount of Loan | Being small cash loans, lending parameters normally range between Rs.50,000 – Rs.3,00,000. However, it differs from lender to lender. | A loan given against a caveat, states that the loan availed cannot exceed 25% of the available amount in the PPF account at the end of the second year, which immediately precedes the year when the loan is applied. |
Rate of Interest | Interest ranges between 11% – 35% per annum based on the lender. | Irrespective of the loan sanctioned, interest is charged at a nominal rate of 1%, but the account holder does not get paid any interest on the PPF amount until the loan gets repaid. |
Penalty | May vary as per individual lenders. | If the loan is not repaid within 3 years, then interest has to be paid at 4% |
Number of loans | Can avail of more than one personal loan if you pay regular EMIs and hold a good credit history. | Only one loan is allowed per fiscal year. |
Hero Fincorp offers a wide range of financial products including Personal Loans for personal needs, Business Loans to support business growth, Used Car Loans for purchasing pre-owned vehicles, Two-Wheeler Loans for bike financing, and Loan Against Property for leveraging real estate assets. We provide tailored solutions with quick processing, minimal paperwork, and flexible repayment options for smooth and convenient borrowing experience.