Maximizing Your Salary: How Salary Advance Loans Can Help in India
An advance Salary Loan in India is a convenient credit solution for salaried employees who need extra cash to manage their unexpected expenses. A salaried employee has to manage all the expenses within a fixed monthly salary and practice proper budgeting. However financial emergencies may come to any, whether it is due to medical bills, educational costs, travel expenses, household needs or even shopping. To meet these additional financial requirements the solution can be - An advance salary loan. With this loan, you can borrow a portion of your salary in advance and pay it back over time.
Salary Advance Loans: Short-Term Credit for Salaried Employees in India
The loan given exclusively to salary professionals as a loan on salary is called an advance salary loan.
It's a short-term and unsecured loan. Any salaried employee is eligible for this loan. Its sum depends upon how much a lender can offer. It's approved based on your salary slips and bank statements. Mostly a fixed portion of your salary is granted as this loan.
While anyone who is in a job can access this credit facility, it is more popular in big cities like Delhi, Mumbai, Pune, Bangalore etc. The loan can be easily applied for and repaid over time through an online process
Understanding the Features of a Salary Advance Loan in India
Collateral-free:
It is a collateral-free loan. As a salaried employee, you can apply for it. Your credit score can also play a role in the approval of this loan. But you don't have to keep anything as a mortgage for having it.
Loan on salary:
This loan is a loan on salary because your salary forms the base of its approval. Also, the quantum of loans that can be approved is directly proportional to your annual salary. Also, your debt-to-income ratio is observed to make sure that you are not overburdened with financial liabilities.
Short-term loan:
This loan is always a short-term loan given mostly for a year. The tenure of the loan might vary with the lender but never goes over three years. You can choose a fixed or variable monthly deduction as suitable to you for its repayment.
Benefits of an Salary Advance Loans in India
Easy access:
These loans are available online hence you can apply for them anytime from anywhere. If you are applying for this loan from your existing employer the process can become even faster.
No paperwork:
With an online credit facility this loan demands zero paperwork. You can upload all the documents using the E-platform of the lender.
Open eligibility:
The mandatory eligibility criteria for this loan is - you must be a salaried professional. The sum you can borrow might vary with a lender but depends a lot on your salary. The more you earn the more you can borrow. Your salary is the prime factor for deciding the eligibility criteria for this loan.
Least documentation:
Since this loan is offered exclusively to salaried professionals it demands the minimum documentation. Your employment details or enough to prove your eligibility. With your identity proof, address proof, income proof and one photograph you can complete the documentation and head towards verification.
Quick disbursal:
Since e-verification is done through online KYC on this loan instant approval is also possible. Once approved there is no waiting time for the disbursement of the money. Within a week you can access the cash in your account.
Smooth repayment:
You can choose to fix door variable repayment on this loan. Depending upon your tenure you can distribute your instalments. Flexible payback options help in reducing debt while also not disturbing the budget.
No foreclosure fees:
If you choose to close your loan in one shot you can go for it on an advance salary loan. No prepayment charges or foreclosure fee is imposed against the loss of interest.
3 Things to Know about an Salary Advance Loans
High-interest rates:
A salary advance loan attracts the highest rate of interest in India. Due to high interest, the sum of monthly payment instalments raises. Being a short-term loan you also can't choose for more instalments.
Potential debt trap:
Since EMIs are directly deducted from your salary, you need to manage all the other expenses out of the leftover salary. Thus if you can manage your budget with a reduced salary then only you should choose this loan. Otherwise, you would need to borrow more money that will end up in a debt trap.
Small amount loan:
The amount of this loan depends largely on your salary. The higher the salary the more you can avail of this. Sometimes the lender will fix a certain percentage of your salary that you can borrow. In such cases, it is not always possible to go for a higher amount loan. The sum you borrow is directly proportional to the salary you earn.
Top 5 Usage of an Salary Advance Loans in India
This loan is suitable for any of your one-time financial needs. When the expenses are not recurring in nature you can easily meet them using a loan on salary. Following are the top 5 areas, in this loan that is frequently utilised for.
House or rent deposit:
If you have joined a new job or relocating for any reason you can make the house deposit using this loan. If you have bought a new house and you want to make its down payment then also you can choose this loan.
Education and upskill expenses:
The education of your children is a crucial responsibility. When it demands some financial aid you can easily fill it with this loan. Also if you want to up your skills or need to invest in some goals for promotion this loan can be apt.
House and vehicle repair:
House repair may be pending for a long time but it also can happen suddenly as it can for your vehicle. You no longer have to struggle with such situations in a cash crunch. Using this loan you can easily go for repairs and improvements.
Payment of bills:
Your utility bills can also be easily met using a salary advance loan. If your bill has accumulated and you don't have any other source to pay for them you can easily choose this loan.
Wedding expenses:
Weddings are for a lifetime and if you want to make it a memorable day go for this loan. While you can easily borrow a good amount proportional to your salary you can also pay it off gradually.
Eligibility Criteria of an Salary Advance Loans
Any salaried employee with a permanent job is eligible to apply for this loan. Also, the borrower must be an Indian citizen with an age of 18 years or more.
Documents Required to Apply for an Salary Advance Loans
It is easy to obtain an advance salary loan in India with us, because of minimal documentation. Ensure that you are submitting valid and legal documents such as:
- Identity proof - PAN card/ Aadhar card/ Passport/ Driving license/ Army ID etc.
- Permanent and current address proof - Aadhar card/ Utility bills/ Rent Receipt
- Current employment proof - Office ID card/ Appointment letter
- Income Proof - Salary slips and Bank account statements of the last 3-6 months
- Latest Photograph or selfie while applying online
Application Process for an Instant Salary Advance Loans
Use the salary advance app (Your employer or others)
Fill in the application with personal credentials like name, age, contact, PAN details, etc.
Update the employment and income details (add the name of an employer organisation, nature and type of job, years in Job, and monthly income)
Upload the necessary documents and go for the e-KYC
Does FlexSalary Give an Salary Advance Loans?
FlexSalary does give credit on salary but not an advance salary loan. Here, you can borrow a line of credit based on your salary slips and bank statements. It is also an unsecured credit facility that comes with a reasonable rate of interest and flexible payback options. Anyone with a salary of Rs.8000 per month is eligible to borrow up to Rs.2 lakh. Its lowest credit is Rs.500 which makes this perfect for both small and bigger cash requirements.
Here you can repay your dues in variable installments anytime in a flexible tenure of 3 to 36 months. You can also renew your credit limit here just with one click by using its mobile app or the official website. After repayment, you can easily revise your credit limit here. If you choose to prepay your dues no prepayment charges are imposed against the loss of interest. If you are a salaried employee looking for additional cash support FlexSalary line of credit can be your continuous credit support.
