What is a Loan Without Financials?

A loan without financials refers to a lending option where applicants can avail a loan without submitting income proof documents like salary slips, bank statements, income tax returns, profit and loss statements, etc.

Here are the key features of a loan without financials:

• Eligibility Criteria: These loans are approved based on the applicant’s profile, which includes credit history, repayment track record, personal details, etc. Typically, employment and income details are not required.
• Loan Amount: The loan amount is generally lower compared to regular loans and based on profiling parameters set by the lending institution.
• Interest Rates: Interest rates for these loans are usually higher compared to regular loans due to increased risk for the loan provider.
• Tenure: The maximum loan tenure offered is typically 2 to 5 years, so borrowers can repay using future income. However, some lending institutions may offer longer tenures.
• End Use of Funds: Borrowers can use the funds for personal expenses or urgent needs. Typically, lending institutions may restrict usage for speculative activities.
• Target Audience: This loan option is typically designed for salaried individuals, working professionals, self-employed persons, and business owners who cannot provide financial documents.
• Application Procedure: The application involves submitting Know Your Customer (KYC) and personal details. Income proof is not needed. A credit check and profiling are done to assess the loan amount.