personal loan: how to get a contactless personal loan completely online

Digitization has made it possible to avail a personal loan digitally or online. The advent of all things “contactless” in this pandemic era has transformed digital personal loans from just a quick and convenient way to take out a loan to a better and safer way to do so. Perhaps the offline paper-based personal loan application process could meet the same fate as a fax machine in a few years.

Who can get a personal loan online?

Anyone eligible for a normal personal loan can also get one online. Thus, all salaried people and professionals in regular paid employment can benefit from an online personal loan. In fact, the scope of online personal loans is even wider than normal personal loans because there is no geographic restriction.

Where can you get loans online

These loans are available from all major banks, NBFCs and fintech platforms. Note that a customer can avail a digital personal loan from any lender they choose and whoever has the best deal instead of necessarily taking it from the bank where the customer has a payday account.

Online Personal Loan Interest Rates

It’s also worth noting that online personal loans don’t have to be expensive or come with high interest rates or high processing fees. In fact, they may even be cheaper than regular personal loans. Depending on the borrower’s income, the company the person works for, the amount of the loan required and the credit score, the interest rate can vary from 10.25% per annum (based on declining balance) to 36%. It is therefore advisable to compare the different offers on the market and choose the one that suits you best.

Read also :
Comparison of the best personal loan rates from banks

Updated digital KYC required

The key to availing the loan at an attractive rate in a quick and convenient manner, however, lies in having a correct and up-to-date digital KYC fingerprint.

How to get a loan online successfully

Here is a simple five-point checklist for a successful online personal loan application:

  1. Your mobile number should be updated in your Aadhaar and bank account.
  2. You must have an active net banking facility in your main savings bank account in which you receive your monthly salary and the updated mobile phone number with the bank must match the one you are applying for the loan with and the one associated with your Aadhaar.
  3. Your last current address should be updated in your Aadhaar and Savings Bank account.
  4. You must be able to receive and send emails from your official email address, if you have one.
  5. You must have original physical copies of your main KYC documents, mainly your PAN card, Aadhaar card with the correct current address, in order to complete the KYC video.

When the loan process cannot be completed entirely online

If you don’t meet any of the five conditions above, you may still qualify for a personal loan, but part of the process may have to be done physically. The most common reasons why a personal loan applied for online ends up requiring a physical step are:

  1. Different mobile numbers used in Aadhaar, bank account and loan application. In such cases, online KYC and/or desktop verification are likely to fail.
  2. Unused or deactivated net bank facility. In such a case, you will need to upload bank statements to the loan provider’s website or app and then these will need to be verified, which may take time and delay your loan sanction.
  3. It is common for people to only update their permanent address and not the current address in Aadhaar and bank statement. In case your updated address in Aadhaar and bank statements are from a remote or native location while you are actually working in a metro or city, chances are your application will be delayed or even rejected.
  4. Do you look like the picture on your Aadhaar card? Remember that KYC video uses machine-based facial recognition and if your photo on the KYC documents does not match the one captured in the KYC video, the application may be rejected. So if your Aadhaar has a photo without glasses and with a beard, it may be better to be the same when you show up for the KYC video.

So, before applying for a personal loan online, check if you meet the above conditions.

(The author is CFA and co-founder of

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