Know what your credit score says about you

Based on your loan history (of all kinds), a credit score is a number that measures and rates your financial health. To decide whether to accept someone for a loan or credit card and to determine what interest rate to charge, lenders use credit scores.

In order to decide whether to rent your house, give you a job, or how much to charge you for car insurance, other businesses may also use your credit score.

Let us understand what credit scores really are

The credit score ranges between approximately 300 and 850. “Good” scores are considered in the range of 600. When you have a higher score, you have a greater chance of being accepted for loans in more favorable conditions. You can visit the EarlySalary Free Credit Score check to get an idea of your credit scores. The free credit score facility is also part of the EarlySalary Credit Suite – a complete offering for aspiring Indian professionals, featuring Instant loans, a Salary Card, and much more!

There are two types of credit scores –  generic & custom scores:

  1. To assess general credit risk, credit scores are utilized by several forms of businesses and lenders. Using the same formula for all three credit reporting agencies, you can access the generic score as one score.
  2. Custom scores are for individual lenders. It relies upon credit score reports and other data from the lender’s own portfolio, such as account history. These are unique to a single organization or may be used by specific forms of lenders. For specific types of lending, for example, mortgage or auto loans, custom credit scores can apply.

What Kind of Borrower are you: What a Credit Score Reveals

  • History of Payments

When they give somebody money, there is one main question that lenders have in their minds: “Will I get it back?”

The following factors are taken into account in this portion of your score:

For each account on your credit report, have you paid your bills on time? Paying late has a detrimental impact on your ranking.

How late were you—30 days, 60 days, or 90 + days if you paid late? The later you are, the worse your score is.

Have some of your collection accounts been sent to you? To potential lenders, this is a red flag that you could not pay them back.

  • Owed amounts

This second-most critical portion discusses the following considerations:
How much would you intend to give on those forms of accounts, such as mortgages, car loans, credit cards, and payment accounts?

How much do you owe in total and how much do you owe in installment accounts as opposed to the original amount?

How much did you use your total usable credit? Nothing is better, but owing a little can be better than owning none at all. That way, lenders get to see that you are accountable and financially secure enough to pay it back if you borrow money.

Credit Score
  • Credit History duration
    How long you’ve been using credit also takes into account your credit score. You’ve had commitments for how many years? What is the average age of all your accounts and how old is your oldest account?
  • New credit
    The credit score takes into account how many new accounts you’ve got. It looks at how many new accounts you have recently applied for and when you opened a new account for the last time.
  • Credit forms in use
    If you have a combination of various forms of credit, such as credit cards, store accounts, revolving loans, and mortgages, is the final thing you consider when deciding your credit score. It also looks at how many accounts you have in total. As this is a small component of your ranking, don’t worry if you don’t have accounts in any of these categories, and just increase your mix of credit types by not opening new accounts.

Small tips to keep in mind while you apply for a loan

  • Pay the bills on time, and don’t be more than 30 days late if you need to be late.
  • Don’t open lots of new accounts all at once or even over a span of 12 months.
  • If you plan to make a big purchase, such as purchasing a house or a car, which would require you to take out a loan, check your credit score about six months in advance.
  • Keep the balance of credit cards below 15-25 percent of your total credit available.

Do you always need a credit score?

Although your credit score is important for getting accepted for loans and getting the best rate of interest, to get the kind of score that lenders want to see, you don’t need to stress about the scoring criteria. With credit solutions like EarlySalary that offer more than just instant loans, there may not be any reason for you to consider a traditional lender. EarlySalary’s Credit Suite is a revolutionary new all-in-one package for aspirational Indians of this next decade. With a free credit score facility available instantly, there’s also:

  • Short term, Instant loans with ₹8000 to ₹5 lakhs limit
  • Long Term Personal Loans with the 12-months to 36-months EMI options
  • Free credit score facility for a detailed snapshot of your credit financial position 
  • All-new digital EarlySalary Card with customized credit solutions customized features
  • Buy on EMI functionality so you can ‘Pay Later’ during checkouts.

Sure, your score will shine if you handle your credit wisely. But your finances can shine without a credit score too!

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:

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Download the EarlySalary app here, or simply log in to our website and be aware of your credit scores.

A Salary Advance, Now On A Card: Introducing The SalaryCard

The fintech sector has come along in the last half a decade. And so have our aspirations. Those of us fresh into our careers back then have evolved from young professionals building our lives, to aspirational individuals propelled by our own ambitions. In this period, EarlySalary is proud to have been a true partner – with its rapid, simplified credit access to millions of young working professionals. 

With EarlySalary, while it’s been possible to access a simple solution for all that you desire, we’re now announcing some major upgrades to serve you for this next phase of your financial journey. 

We’re announcing the instant, hassle-free SalaryCard.

What Is The SalaryCard?

Over the past 5 years, EarlySalary has grown to become one of the largest consumer lending FinTech brand in India, having disbursed over 1.7 Million loans, powered by a fully automated and ML-based decision system that allows thousands of loans to be disbursed each day.

Clearly, expanding credit access has been our overriding agenda. So it was only logical that we follow it up with a tool that further simplifies and expands credit for the country.

In the spirit of true digital India, by Indians, and for Indians, we’re delighted to introduce the Salary Card. The Salary Card is designed to be as mainstream as every other financial instrument – it is powered by RuPay and NPCI payment platform. But simultaneously, it’s also a cut above the rest by being entirely digital – no manual underwriting, no long wait times in your applications like with all other banks. 

But let’s move to what matters most – the SalaryCard’s core functionality:

  • The Salary Card is a prepaid instrument that allows your transactions to be automatically converted into flexible EMIs ranging from 3 to 12 payments, with zero prepayment charges. 
  • Gone are the days of Kafkaesque paperwork and hassle to secure credit for our ambitions, whether it’s the latest gadget or even our kids’ education. The SalaryCard allows you to directly transfer the fee to the educational institution from your credit limit with zero paperwork. 
  • It’s extremely easy to manage with your EarlySalary mobile application. The maximum limit is roughly equal to your monthly salary. But you can also set dynamic limits. In other words, it is possible to spend twice your monthly salary on this card.

How Do I Get The SalaryCard? 

The digital card can be easily obtained online using the EarlySalary app, within minutes. There are no subscription fees – it’s a free card! 

There are certain eligibility criteria, however, so be sure to check if you are eligible before applying for the card. You:

  1. Should be a resident of India
  2. Should be above 21 years of age, but below 55 
  3. Should be a salaried individual with a minimum of INR 18,000 in urban cities, and INR 15,000 in rural cities.

The entire process takes just a few minutes once you have an approved EarlySalary limit. And, of course, it is safe as users need to answer 2 security questions and have a 6 digit passcode set up in order to use the SalaryCard.

What Can I Spend It On?

The SalaryCard can be used for all indulgences, aspirations, essentials, and basically everything you can think of. So shopping, travel and entertainment, electronics, medicine and insurance, and even for skill upgrades (education and vocational training) – they’re all welcome. Instant loans with zero cost EMIs can be used for purchases on Amazon and Flipkart.

As a user, you will be rewarded after every transaction. This is over and above any Rupay Offers – which can save you Rs 10,000 additionally. All you have to do is shake your phone to see what you have won!

The limits for various categories can be varied, so make sure to check the EarlySalary app to fine-tune it as per your preference. 

Are There Any Prepayment Fees / Cancellation Fees?

No. There are no hidden charges, apart from the convenience fee of INR 199. You can prepay the EMIs and cancel your SalaryCard absolutely free of charge.

How Can I Manage The SalaryCard?

The SalaryCard can be managed with just a few taps from your fingers. Download the EarlySalary app here, and voila, everything you need at your fingertips. 

What are you waiting for? Download the EarlySalary app now, and join EarlySalary’s Credit Suite – celebrate the giant leap we’ve made for the Indian credit ecosystem!

Alternative Data Is Now Mainstream in Credit Risk Analysis

Over the years, an individual’s or even an organization’s creditworthiness has come to be defined by their credit score. A loanee’s traditional data (e.g. credit history, types of credit, credit utilization, etc.) is usually the only factor considered by credit scoring systems to evaluate their creditworthiness. The problem with this system is that a significant part of the population has an insufficient or nonexistent credit history – making them credit-invisible. Indeed, the most common barrier many loanees in India face is the lack of a credit score.

To provide credit access to a wider audience and achieve financial inclusion, loaning institutions must consider a different approach to confirm a loanee’s creditworthiness.  This is where alternative credit data comes in. 

What is Alternative Credit Data?

Alternative credit data, sometimes categorized as big data, is any data that’s not directly related to a client’s credit conduct. Alternative data regarding a client can be obtained from a number of non-traditional data sources- e.g. digital platforms that can provide information on consumer activities for credit risk assessment. Before lending out to a customer, lenders can have credit risk management models leverage alternative data to develop credit scores and ensure their customers’ creditworthiness. 

Alternative data, credit risk analysis

Alternative data for credit scoring can be a combination of the information collected from multiple sources, including a consumer’s utility, rental, insurance, and other bills payments history, social media usage, employment history, travel history, e-commerce, government transactions, and property records.

However, when collecting alternative data for credit risk analysis, it’s important to remember that the gathered data must consist of data points that show the loanee’s habits, preferences, behavior, and character- which is one of the five C’s of credit risk (the others being capacity, condition, capital, and collateral). 

It’s also important to make sure the borrower cannot directly or indirectly manipulate any of the given data. This ensures a thorough evaluation of the potential loanee’s financial abilities and credit risk profile.

How Reliable is Alternative Data When Predicting Credit Risks?

When it comes to using alternative data in credit risk analysis, there’s no specific set of guidelines to follow. Since this approach to credit risk analysis is also fairly new, it’s still in its tentative stages – there’s no extensive historical evidence available to guarantee alternative data’s effectiveness or reliability when it comes to credit risk predictions.  

However, it’s undeniable that even with the traditional way of risk assessment, there’s always going to be risks in the lending business. The alternative data system, keeping up with the digital age, has certainly proven to be more efficient in credit risk analysis, since it focuses on a loanee’s behavior and can bring up data points that the traditional methods might have glossed over. An added benefit of using alternative data in risk appraisal is the increased levels of accuracy, compared to the traditional way of credit scoring.  

In recent years, the general market practices have slowly evolved, with more and more lenders using additional information related to the user along with the traditional credit report to make better lending choices. According to Experian, 65% of lenders in 2019 used some information beyond the traditional credit scores to make lending decisions.

Whether combined with traditional credit scores or not, alternative data provides a detailed picture of a potential loanee’s creditworthiness. It allows creditors to expand their reaches and recognize new, profitable lending opportunities. Plus, with advanced ML implementation (more on that later), alternative metadata can be translated into reliable credit scores.

Where to Get Alternative Credit Data?

A wide range of non-traditional data can attest to a loanee’s creditworthiness – the sources and sorts of data used in the credit risk analysis depend entirely upon the creditor organization. 

As per this research conducted by the management consulting firm Oliver Wyman, a meticulous alternative credit data source should have these features:

  1. Coverage: A data source will ideally have broad and consistent coverage (for instance, the mobile phone market is more concentrated than most others, so data collection is easier there).
  2. Specificity: The data source should contain detailed information about the individual/organization applying for a loan. (e.g., timely/late payments over a particular time period, income data, etc.).
  3. Accuracy and Timeliness: The data considered must be accurate and updated frequently.
  4. Predictive Power:  The information should be relevant to the specific consumer behavior being assessed.
  5. Orthogonality: Ideally, the data source would complement traditional bureau data, so that its use would improve the accuracy of traditional credit score.
  6. Regulatory compliance: Alternative credit data sources must abide by existing regulations for consumer credit.

A few types of alternative data frequently used in credit risk analysis are:

  1. Phone, Rent, and Utility bills: Since all of these payments have to be made periodically, they are some of the most trustworthy sources for alternative data collection. Periodic payments provide frequently updated insight into a  consumer’s financial behavior. 
  2. Social Media Accounts: A consumer’s social media pages (for example, LinkedIn, Facebook, Instagram, and Twitter) can bring forth a lot of information including their employment status, lifestyle, and spending habits, etc. However, the data displayed on social media can be inaccurate and is also directly influenced by the consumer; therefore, the credibility of alternative data procured through social media can be diluted.  

ML Adoption in Extracting and Processing Alternative Data:

When it comes to processing the gathered alternative credit data, manually going through a loanee’s information would be incredibly taxing, not to mention the quite high chances of human errors or oversight. Therefore, it’d be in the best interests of lending corporations to look into advanced technologies such as machine learning and AI (artificial intelligence) that can take over the process on their behalf. 

ML, or machine learning, comes with superlative analytical frameworks that could help in evaluating data accurately and recognizing the key patterns in customer behavior under different circumstances. The convergence of different ML techniques with alternative data could prove revolutionary in credit risk analysis. Some of the advantages that ML can provide are:

  • Rooting out only the useful information out of sizable data sets
  • Lowering data processing time
  • Giving a full rundown of a customer’s creditworthiness based on the collected data 
  • Recognizing key patterns in consumer behavior under different circumstances
  • Predicting a loanee’s ability to repay the loan in time

Interested in learning more about the whys and hows of integrating machine learning into credit risk analysis? We’re happy to share our thoughts on the convergence of machine learning and big data in credit risk management.

With the number of people looking to get loans for varying purposes, increasing with every passing day, the credit industry needs to realize the significance and benefits of financial inclusion. After all, only a small percentage of people in Asia have a formal credit history; to work towards closing the lending gap that still exists, companies need to look into other ways to evaluate a person’s creditworthiness. It’s realities like these that led to EarlySalary and all its innovations in the credit space, enabling us to achieve 1 million loan disbursals.

As the usage of smartphones grows and the financial systems worldwide gradually become internet-based, tracing a person’s digital footprints has become a lot easier. Besides, collecting alternative data has inarguably gotten simpler than accumulating traditional credit data. 

Keeping pace with the advancements in individual technologies, the introduction of an alternative data-based credit risk management system in loaning organizations only seems reasonable. Taken into account, the sheer amount of still unrealized possibilities that ML incorporation into credit risk analysis brings, the future of credit risk management sure looks bright. 

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
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Download the EarlySalary app here, or simply log in to our website and be a part of the #OneSmallStep experience.

EarlySalary Just Turned 5. #OneSmallStep for us, one giant leap for the Indian Credit Ecosystem

Since its inception five years ago, EarlySalary has enabled rapid, simplified credit access to millions of young working professionals. Be it assisting someone adjusting to a new town or helping them upgrade their skills. As Mr. Akshay Mehrotra, CEO and Co-Founder at EarlySalary puts it, “over the past 5 years, we have built one of the largest consumer lending FinTech Company of India and have disbursed over 1.7 Million loans, have built a fully automated & ML based decisions system which allow thousands of loans to be disbursed each day.”

The journey so far has been an exhilarating one. Acceptance by customers has been another challenge, but with time, we have been able to establish ourselves in the Indian credit ecosystem. We’d like to walk you through our fascinating journey.

Five Years of EarlySalary 

A primary goal at EarlySalary has been to provide an amazing borrowing experience for the salaried class. With offerings such as the SalaryCard and low-cost EMI options for shopping, the attempt has been to allow consumers to spend unrestricted, unhindered. Even when their credit scores may not permit traditional credit access. Simultaneously, importance also had to be placed on the convenience of the process. With a secure, entirely digital application procedure and 24*7 availability, the convenience of the customer while seeking instant loans has always been a top priority.

EarlySalary Credit Suite

In these five years, the pillars of the business that have got EarlySalary where it is today include the following.

  • Customer Partnerships – Over the years, EarlySalary has been part of some great partnerships. The employer tie-up program allows employers to partner with us and be part of the financial wellness program. We also provide loans for consumers to be able to spend on Amazon, Flipkart, or Makemytrip.
  • Data – EarlySalary has kept its pace with the data revolution, and it’s this data that has helped to extend a seamless experience to the customers.
  • A Stellar Tech Team – For a company providing a fully digital experience, technology has been the backbone of EarlySalary’s success. From the latest app updates to a secure payment process, technology will continue to remain a central aspect of this journey.
  • Exciting Products – EarlySalary products include instant cash loan, SalaryCard, personal loan, free credit score, and salary advance. The aim is to continue working on the optimization of these products.
  • Lending Partners– Our new and existing lenders have also played a crucial role in our success.

The Indian Credit Ecosystem Needs a Giant Leap

Despite our successes in the sector and the strides we’re proud of, getting access to short-term credit can often be extremely difficult for many in the country. A low credit score is often synonymous with rejected loan applications and the consequential, cascading effect on an individual’s life, such as the opportunity costs in upskilling oneself, or even difficulties in renting the right house. 

EarlySalary Credit Suite

The loan process itself remains wedded to the past. While at EarlySalary we’ve been entirely digital for as long as we can remember, credit access in India should ideally be as simple as swiping a card, shouldn’t it? 

These challenges are compounded further during times of an economic crisis. Such a scenario necessitates the presence of trusted creditors that can provide easy access to short-term credit.

The global pandemic brought life to a halt, and overcoming it has been an independent challenge in itself. With Reboot 2020, EarlySalary has helped customers have a fresh start. And as local economies resume and open up, customers are once again returning to a credit system that’s quite frankly, in need of an overhaul.

And that’s exactly what we’re here to deliver as we enter our sixth year. In the words of Ashish Goyal, Co-Founder and CFO of EarlySalary, “ the saying goes – ’Never let the good crisis go to waste’ and we did exactly that. In the last 6 months during the pandemic & lockdown period, we had invested our time in building new customer relationships, new products, and new opportunities at EarlySalary.”

We’re Starting with #OneSmallStep – The EarlySalary Credit Suite

EarlySalary Credit Suite

This month, we’re marking our five-year celebrations with a special campaign aptly titled #OneSmallStep. And on that note, we’re bringing you the EarlySalary Credit Suite. The Credit Suite represents our product array of free credit score checks, short-term loans, personal loans, SalaryCard, and the option to check out and pay later. Here’s a quick list of the features we’re packing in this giant leap:

  • Short term, Instant loans with ₹8000 to ₹5 lakhs limit
  • Long Term Personal Loans with the 12-months to 36-months EMI options
  • Free credit score facility for a detailed snapshot of your credit financial position 
  • All-new digital EarlySalary Card with customized credit solutions customized features
  • Buy on EMI functionality so you can ‘Pay Later’ during checkouts.

And the best part about this is that the entire credit suite is only a tap away – no formalities and completely digital. All on your smartphone!

EarlySalary Credit suite

While the EarlySalary Credit Suite is only a small step amongst many others that we have taken over these five years, it reflects a big leap for the Indian credit ecosystem as a lifestyle finance tool. With it, customers will be able to manage their life’s experiences with the utmost convenience. 

Thank you, India!

Over the years, massive efforts have gone into making this journey possible. All the lines of code written, every customer helped out, and every new product launched, has led us to where we are now. For the people who never hold back from their aspirations, who love going places, and who want to fulfill their ambitions by upskilling themselves, EarlySalary has been a blessing. We shall continue to improve, innovate, and remain committed to excellence.

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
Our Facebook Page
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Our Instagram Page
Our LinkedIn Page
Download the EarlySalary app here, or simply log in to our website and be a part of the #OneSmallStep experience.

The RBI Moratorium Saga In 2020: All You Need To Know

The coronavirus pandemic hit economies worldwide, and regulatory authorities like the Reserve Bank of India recognized the hardships that borrowers might be facing in repayment of loans in times of such uncertainty. Hence, as a relief measure, the RBI introduced EMI moratoriums on all term loans in March 2020. This was for a duration of three months, that is, till 31st May 2020. However, this moratorium was further extended for three additional months, stretching is to 31st August 2020. This move by the RBI was intended to provide borrowers with some relief amid the Covid-19 pandemic. In October 2020, the Supreme Court got involved, and the matter underwent fairly new interpretations and changes, with many asking what really the RBI moratorium meant for borrowers.

Here’s all you need to know: 

About the moratorium on loan EMIs

In March 2020, the RBI offered a loan moratorium of three months initially, till 31st May 2020, to help borrowers tide over the financial struggles they faced due to the coronavirus pandemic. This was valid on equated monthly installments (EMIs) and was further extended to 31st August 2020. This moratorium was valid for all loans, which included education loans, home loans, personal loans, and credit card dues. 

During this moratorium period, borrowers were not required to pay the standard EMIs on their loans. This measure was aimed at giving borrowers more time to clear payments of EMIs without being classified as non-performing assets (NPAs), amid the grave economic repercussions of the lockdown. 

Eligibility criteria

The circular released by the Reserve Bank of India, dated 27th March 2020, declared that all individual borrowers were eligible to apply for the loan moratorium. This was valid for EMIs whose loans were outstanding as of 1st March 2020. 

How does it work?

The entire process was aimed towards providing borrowers with relief amid the adverse financial implications of the pandemic. Anyone who had opted for this moratorium was not required to pay EMIs during the said period. However, the interest was not waived off and would continue to accrue on the outstanding amount. 

This meant that borrowers had to pay additional interest on months covered in the moratorium on EMIs either by increasing the installment amount or by increasing the tenure of the loan. The RBI, however, assured borrowers in its circular that opting for the same would not negatively impact their credit scores or lead to credit downgrading. 

What does it mean for lenders?

Lenders such as commercial banks, including rural banks, local area banks, and small finance banks, NBFCs, all-India banks, and co-operative banks were permitted to allow the moratorium on EMI loans. In its annual report, the central bank reported that a moratorium on loan repayments would have an impact on the financial health of banks. This was after the SC issued a statement in support of borrowers, which said that ‘there is no merit charging interest on interest’. 

On June 4, 2020, the RBI said that lenders might lose up to Rs. 2 lakh crore if interest was waived off for the moratorium period. To tackle this problem, on 2nd October 2020, the central government told the SC that it would waive off compound interest on loan repayments of up to Rs. 2 crores, a move that was aimed at providing relief to MSME and individual borrowers. 

On 5th October 2020, the apex court granted the government and the RBI to file additional affidavits, the hearing was scheduled for the next day.

The hearing on 14th October 2020 concluded with RBI clarifying that only standard loan accounts as of 1st March 2020 could be recast under the moratorium. This means that: 

  • If a loan account that was due for over 30 days as of 1st March 2020 but got regularised, it would not be eligible or valid for the Covid-19 resolution framework. 
  • Hence, the restructuring framework is only applicable to eligible borrowers who were categorized as standard as of 1st March 2020. 
  • The Reserve Bank of India also agreed to waive off the ‘interest on interest’ or compound interest. This was to be charged on loans of up to INR 2 crore for the 6 month moratorium period announced at the beginning of the coronavirus wave. 
  • Moreover, the apex court also asked the government to implement this decision of waiving off the compound interest without delay and has asked the Centre to return with an appropriate action plan on 2nd November 2020. The government has addressed SC’s concern of possible implementation delays and given an outer limit extending to 15th November 2020 for the same. 

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
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Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.

5 Ways To Plan your Monthly EMIs on Instant Money Loans

When it comes to loans, perhaps even before the loan amount is finalized, the first thing that comes to a borrower’s mind is repayment. Monthly EMIs is one of the most pervasive ways through which financial institutions give out loans and ensure repayment occurs at regular time intervals. The amount of your Equated Monthly Installments (EMIs) depends on the amount of money you have borrowed. The sanctioned loan amount as a whole can depend on your income and your credit score. A combination of these along with how fast you choose to repay your loan at a given interest rate, are the factors that determine your EMI amounts. Monthly EMIs on Instant Money Loans can be stressful if you don’t plan ahead. This is why we have curated a checklist to help you plan your monthly EMIs on Instant Money Loans!

Here are 5 ways through which you can plan your monthly EMIs on Instant Money Loans!

  • List down your monthly expenditure 

One of the most important steps, when you’re taking on an instant money loan, is to take into account your overall expenditure and incoming income. This will help you determine the amount you can repay every month through EMIs without it being a burden on your finances. Chart out all your expenses to determine where your money is going, and cut down on expenses that can be cut down. Moreover, also take into consideration any emergency expenditures you might have, such as medical bills and family expenses, so that your instant money loans do not affect your regular and household expenditures. 

  • Keep a separate account for servicing the loan

If you desire a close eye on your expenses and need aids for planning better for your instant money loans, having different accounts for different expenses makes tracking easier, efficient, and accurate, as compared to having a single account for all kinds of expenditures. Additionally, you can also identify different patterns of your expenses!

  • Reinvent how you approach your finances

‘Do not save what is left after spending, but spend what is left after saving.’ This is the golden rule that must be applied when keeping a check on your expenses. By eliminating unnecessary expenses, you pave way for a more stable instant money loan repayment plan with smoother monthly EMIs and lesser stress. 

For example, if you spend 10% of your salary on eating outside every month, consider reducing it or find alternative ways to fulfill that need. The more you save, the easier and better your monthly EMI repayments will be.

  • Look for minimal or zero prepayment charges

Loans can often have hidden charges that ultimately cost you more and make your EMIs unaffordable. It’s also not rare for people to come across an unprecedented lump amount. In such a scenario, you might be able to repay a majority of the entire loan amount to your lender. Hence, before taking instant money loans, look for companies that offer minimal prepayment charges. EarlySalary’s instant money loans come with zero prepayment charges if you decide to repay your loan earlier than the agreed duration. Plus, there are no other hidden charges!

  • Prioritize your loans

Due to the convenient and hassle-free nature of instant money loans provided by lenders such as EarlySalary, you might take more than one loan. Even in our own experience, it isn’t uncommon to serve customers with both an EarlySalary loan and SBI loan, for example. Hence, it is important to prioritize these loans in order of the monthly EMI amount owed, time period for repayment, etc. Sort these loans to clear the loans with the highest interest rates first. 

If a loan with a high-interest rate is not paid on time, it is likely to entail a heftier penalty compared to any other loan with a lower rate of interest. Moreover, repaying a loan with a high-interest rate over a long duration also means that you will be paying more interest as opposed to one with a low rate of interest.

EarlySalary’s Instant money loans are designed to provide rapid credit solutions in a hassle-free manner. With a sensible, modern personal loan option, you skip the lengthy paperwork and have access to attractive interest rates with no prepayment charges. Moreover, you can borrow up to INR 5 lakh and have it transferred to your bank account within minutes!

Download the EarlySalary app for your phone to get started!

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
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Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.

What Hidden Charges Should You Expect With Personal Loans?

See the asterisk (*) and hashtag (#) symbol with your loan application on your apps? They are the best way to disguise hidden charges with your personal loan application. According to the TransUnion CIBIL Consumer Report of Q4 2018, there has been 29.3% YoY growth on total unsecured loans. Considering so many people are into this, it’s important to be aware of these hidden charges.

  • Processing Fees: This is the most common hidden charge which comes up with your personal loan apps. This is either charged upfront or is deducted from the disbursed loan amount. This fee is generally non-refundable and is not minimal. It is somewhere between 2% and 3% of the application amount. These costs certainly increase the repayment amount rather than easing your financials.
  • Cancellation Charges: Today, this has become a feature of every kind of service you avail of, be it flights and train bookings or availing a personal loan. The charges vary from institution to institution. They can start somewhere at flat Rs. 1,000 to around Rs. 3,000 with an additional 18% GST is charged. Some institutions may not charge a flat fee but will charge the applicable interest rate between loan disbursal and cancellation days.
  • Prepayment penalties: Remember, as a customer, personal loans could be a trap. Anything more than the EMI amount may get you penalties of 2-5% of the outstanding loan amount. Why do prepayment penalties exist? According to the financial institutions, they lose on the interest rate they would get if the repayment is made as per schedule.
  • Late payment charges: This is a no-brainer. If you default on your payments or get late with repaying your EMIs, you will be penalized. Perhaps ironically, neither can you repay your loan amount before time, nor can you do that after time. The late payment fees may go up to 2-3% of the EMI amount. This means you might pay more interest on your late fees than your actual loan!
  • Effective interest rates: The effective interest rates on personal loans range anywhere between 10.99% and 24% p.a. The upper limit might go higher in the case of non-salaried individuals too. Further, other factors like credit score, relationship with the bank, and financial stability help in determining the applicable interest rate.
  • Repayment mode swapping charges: If the mode of repayment is suddenly swapped, say from paying via cheque to auto-debit, you will be charged for this too. Lenders usually charge around Rs. 500 + 18% GST as the swapping charge during the loan tenure.
  • Duplicate documentation charges: The financial institution would charge some extra fee for reissuing loan-related documents. These can include statements, NOCs, credit reports, etc. It is generally charged somewhere between Rs. 50 to Rs. 500 (plus 18% GST) for duplication.
  • Other charges: There could be various applicable charges depending upon the lender. This might be based on the type of lender, customer’s repayment behavior, types of loan sanctioned, or even the place from where it is sanctioned. They might also charge for stamp duties and other legal charges.
  • GST: Earlier, it was the service tax and VAT that were applied on loan-related services. Now, it’s the Goods & Services Tax (GST). This is barely ever mentioned in the loan documentation process but suddenly arises during the payment. The amount in India is relatively high, as the standard is 18% on any loan processing service. This means on every 100 rupees you are told about, an additional rupees 18 rupees is added in the form of GST.
Hidden charges, personal loan

EarlySalary to your rescue

Hidden charges, personal loan

India’s Largest instant personal loan platform, EarlySalary ensures that money isn’t diverted on some pretext or the other. Especially on hidden charges. The idea is to build a borrowing experience that encourages folks to see loans as an enabler for aspirations, not a last-ditch attempt when no other options are available. Here’s how EarlySalary achieves this:

  • The loan amount can be availed up to Rs. 5 lakh
  • Interest rates that are highly competitive, and depend on your holistic borrowing profile and not just your credit score!
  • Processing fees up to only 1.50%
  • Prepayment charges are NIL
  • Repayment instrument swapping at only up to Rs.250 per rejection
  • A flat, minimal Rs.500/month per default on payment dishonors

Remember, before you avail of your personal loan, ask for all information and research from several sources. This will help you in making an informed decision and selecting the best personal loan option.

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
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Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.

7 Life Goals You Can Achieve Using a Personal Loan

A personal loan is an unsecured loan designed to help folks meet their financial needs. By definition, a personal loan is one where you don’t need to pledge any security or collateral while opting for it. The lender provides the borrower with the flexibility to use the funds as per their own requirements. On closer look, we see that they work fairly similar to secured loans:

  • Most lenders will look at a person’s creditworthiness, among other factors, to determine their interest rate. 
  • Borrowers evaluate the purpose of their loan to determine whether they need to borrow in the first place and if they have the ability to make timely payments.

On that note, it’s natural to wonder – what sort of needs do personal loans satisfy when dedicated loans – such as those for cars, homes, etc. – already proliferate the market?

Personal loans provide solutions for managing everything from wedding expenses, travel costs, and home decor, to construction and renovation, expenses of a medical emergency, debt consolidation, and others. An individual can pay the money back with interest on the basis of monthly installments over a period of time that usually ranges between two to five years. 

Let’s take a look at some of these expenses – particularly those that are often ‘life goals’ for many of us.

#1 Education fees

personal loan

A fairly obvious life goal if there ever was one – education is an enabler, and a great equalizer, regardless of our background, financial status, ethnicity, and more. It’s arguably one of the most critical investments we make in our lives. This is why a personal loan that pays for our education expenses, or even our children’s school fees, fulfills a crucial need. 

#2 Medical expenses

personal loan

Medical bills can come up suddenly and may become difficult to repay; this is when instant personal loans come in handy. We’d all like to be in a position to address any such emergencies when they crop up. Quick medical loans can cover a high medical bill or even an expensive cosmetic surgery. 

#3 Business investments

A business or startup is a goal for many of us. And once it’s up and running, growth quickly becomes our next goal. These pursuits require capital, which is why loans for business expansion can be crucial.

#4 Wedding expenses

In due course of the wedding planning process, couples and families get a closer look at the hefty amounts they’d be paying – from florists and caterers to event venues and wedding planners. Weddings are costly, so many couples turn to personal loans for weddings to cover the expenses, breaking the cost of a wedding into manageable monthly payments.

#5 Debt consolidation

Personal loans can be used to convert several kinds of debt into one fixed monthly payment. This can make it easier for a person to keep track of their bills and also pay off debt on a schedule. The largest benefit of debt consolidation is cost savings. And isn’t it everyone’s life goal to be free of debt as soon as possible? Or at the very least, make it less of an annoyance?

#6 Home improvements or repairs

personal loan

Home renovations add obvious value to one’s home and make it a better place to live. It’s where we spend the majority of our lives, after all. A borrower can finance their home improvement projects via personal loans, which typically cover most such expenses. And of course, when we’re renovating our home with an unsecured personal loan, it’s a pleasant reminder of a credit system that isn’t asking us to put up our home as collateral. We don’t have to risk losing our home, or quite frankly, any other asset, to a bank or institution.

#7 Investing in a vehicle

It can take a long time to save for a car or two-wheeler, despite it being a dream for many. With inexpensive rates on a personal loan, we know exactly what our regular repayments will be and how long it will take for them to pay the loan off. The result? A more informed, educated purchase of a vehicle with a car loan or two-wheeler loan. Our wheels can be here quicker than we may have anticipated!

Clearly, personal loans serve several needs. But in a market crowded with them, how do you identify the one that suits you best?

Enable Your Life Goals With EarlySalary 

personal loan

EarlySalary is an instant loan mobile app that enables salaried professionals to borrow money for virtually any urgent cash requirement they may have. In other words – no questions asked. 

EarlySalary’s online platform is backed by a strong team that aims to build a new credit culture, combining traditional credit scoring with new parameters linked by technology. It’s backed with risk assessment concepts that enable a revolutionary new business allowing everyone to borrow hassle-free!

Along with salaried employees, EarlySalary can also be availed by self-employed individuals as well as business corporates to receive a cash advance in order to meet their urgent credit needs. 

Why EarlySalary For Personal Loans

  1. Loan amount: Earlysalary offers loans that start from Rs. 8,000, and go up to Rs. 5 lakh. 
  2. Digital process: The process to apply for an EarlySalary personal loan is entirely digital. No paperwork involved.
  3. Flexible tenure: One can conveniently repay their EarlySalary personal loan within a flexible tenure featuring 3 to 6 EMIs.
  4. Zero prepayment charge: No charges are applicable if you foreclose your personal loan.

When there’s an urgent need for a quick cash loan, it’s common to see very few genuinely feasible options available. One usually tends to seek a personal loan from traditional banks, which can be a time-consuming process and requires a lot of paperwork and multiple documents. 

The internet has catalyzed a transition to new-age systems that honestly save us considerable time, efforts, and hassle. And instant loans are a logical evolution of the era. Frankly, if we can purchase anything sitting in the comfort of their home, why shouldn’t we get access to credit for those expenses in the very same way? 

It’s this philosophy that’s helped EarlySalary lead the market as one of the best loan apps that one can use. Based in Pune, the model has been revolutionizing the way money lending occurs in India. In short – EarlySalary’s personal loan app is the easiest and fastest way to get instant loans in this new decade.

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
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Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.

SBI Personal Loan Vs EarlySalary Loan: Which One Is Right For You?

When it comes to personal loans, instant approval is a characteristic no customer would decline. In fact, such a feature is prioritized. Fortunately, competitive credit markets give us plenty of choices. Based on your needs and requirements as a borrower, you can choose from a plethora of options available with banking institutions. SBI has several personal loan offerings, such as e-tatkal loans, and the more popular Xpress Credit Personal Loan. On the other hand, portals like EarlySalary are changing the game for young professionals seeking quick and convenient loans. These can range from wedding, vacation, home renovation, medical emergency, education, and much more. Let’s look at how SBI’s Xpress Credit Personal Loan compares with EarlySalary’s Personal Loan and which one is more suitable for you!

SBI Personal Loan vs EarlySalary Loan

Eligibility

A personal loan is the most common type of loan, and for 2020, its demand has spiked significantly. One must be eligible to apply for a personal loan, and eligibility criteria differ from lender to lender. Here are the eligibility criteria for SBI’s Xpress Credit Personal Loan and EarlySalary’s Personal Loan.

SBI Xpress Credit Personal Loan: To apply for an SBI Xpress Credit Personal Loan, the following is the eligibility criteria :

  • Individuals must have a salary account with SBI
  • The minimum monthly income must be INR15,000
  • The maximum loan amount is INR 25,00,000
  • The borrower should be between 21 to 58 years of age

EarlySalary Personal Loan: To apply for EarlySalary’s Personal Loan, the following are the eligibility criteria:

  • Individuals must be Indian Residents
  • Minimum monthly income must be INR 20,000 to INR 22,000 depending on the area of residence
  • The borrower should be between 21 to 55 years of age

Minimum Loan Amount

The minimum loan amount is an important factor to consider when applying for a personal loan as it must be in accordance with the reason why you’re taking a loan in the first place. In this case, EarlySalary takes the cake due to a much lower minimum loan amount, which enables young individuals to make quick decisions and only borrows the amount they need, negating the surplus.

SBI Personal Loan: The minimum loan amount for SBI’s Xpress Credit Personal Loan is INR 25,000

EarlySalary Personal Loan: The minimum loan amount for EarlySalary’s Personal Loan is INR 8,000

Interest Rate

As a borrower, you’d want to pick a lender that offers the lowest interest rate while taking out a personal loan. The following are the interest rates for SBI and EarlySalary:

SBI Personal Loan: The interest rate per annum for SBI’s Xpress Credit Personal Loan ranges from 10.50% to 16.40%.

EarlySalary Personal Loan: Since the personal loans provided by Early Salary are usually short term, the monthly interest rate ranges from 2% to 2.5%.

Prepayment Charges

Prepayment charges or a prepayment penalty is the fees or charge that an individual has to pay the lender or bank if they decide to repay the loan before the end of its term. Prepayment charges can be avoided by taking loans from institutions that give out loans without these penalties, such as EarlySalary. 

SBI Personal Loan: The prepayment charges for SBI Xpress Credit Personal Loan are 3% of the prepaid amount

EarlySalary Personal Loan: There are no prepayment charges or penalties if you decide to repay your loan before the end of its term

Process

SBI Personal Loan: Applying for SBI’s Xpress Credit Personal Loan has been simplified through minimum documentation requirements. However, it is not entirely digital and repayment is only through bank transfer from the salaried account.

EarlySalary Personal Loan: Applying for a Personal Loan through EarlySalary is a quick, hassle-free process that is mostly digital. The personal loan can be repaid through different means such as:

  • Auto Payments
  • Net Banking
  • UPI
  • Adding EarlySalary as a beneficiary in your bank account and transferring money

Long Term Advantages

SBI Personal Loan: Long term advantages of taking an SBI Xpress Credit Personal Loan are:

  • SBI claims low processing charges – these are set at 1.5% of your loan amount.
  • SBI offers a  provision for a second loan
  • Subject to eligibility, SBI claims to offers loan up to 20 Lakhs
  • SBI also claims minimum documentation

EarlySalary Personal Loan: The long term advantages of taking an EarlySalary Personal Loan are plenty:

  • Flexible loan amounts, starting from INR 8,000 to INR 5 Lakhs, with very lenient eligibility criteria. So it’s practically possible for you to receive a loan of the maximum amount.
  • A digital process with minimum documentation. Absolutely no paperwork.
  • Pay as you use: Pay interest only on the amount you use from the credit limit given to you
  • Zero repayment charges
  • Flexible tenure, with the option to repay in a tenure ranging from 90 days to 365 days
ParametersEarlySalary LoanSBI Xpress Credit Personal Loan
EligibilitySalaried individual, Indian ResidentMust have a Salary account with SBI
Interest Rate2% to 2.5% per month10.50% to 16.40% p.a.
Borrower’s
Age
21-55 years21-58 years
ProcessShort, quick, digitalPaperwork involved, therefore slower
Pre-Payment ChargesZero
prepayment charges
3% on prepaid amount
Long-Term
Advantages
Flexible tenure, pay as you use, lesser minimum loan amount, digital processProvision for a second loan
Minimum
Loan
INR 8,000INR 15,000

Hence, there are several things to consider before taking out a personal loan, which depends on why you’re taking the loan. 

In today’s fast-paced world, EarlySalary provides individuals with quick loan solutions with instant approvals and exclusive features such as zero repayment fees, to ensure that the process is hassle-free and digital. Be sure to check out the eligibility criteria before applying for any loan, and read through the terms and conditions carefully to choose the most suitable and appropriate personal loan for your needs!

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
Our Facebook Page
Our Twitter Page
Our Instagram Page
Our LinkedIn Page Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.

How Great Companies Deliver the Best Financial Wellness Programs

A Financial Wellness Program usually expands from standard employee benefits and goes past retirement arranging and contributing data. A balanced one will promote, for employees, everything from precise understanding and appropriate use of money to the point of building not just a stable, but symbiotic relationship with money. 

This is a perspective many evolving corporates are increasingly realizing. But before they begin tackling these opportunities, they are asking some fundamental questions. Such as:

Why should a Financial Wellness Program be provided?

Financial Stress negatively affects the workforce. Multiple examinations, including those from the American Psychological Association and Northwest Mutual, have found that cash issues have been the #1 stressor for young professionals.

This pressure culminates in depression, sleepless nights, and even out and outfits of anxiety, thus incrementing truancy, decreasing efficiency, and fueling high employee turnover. Many reasons employees are worried about their financial circumstances to have little to do with their heads or compensations.

  • Many young professionals are increasingly troubled with educational debt, more so than any other generation. They are beginning their career with immense budgeting problems.
  • Soaring medical care costs are another reason for worry for all ages. 
  • The most recent decade’s downturn cleared out gigantic lumps from individuals’ retirement portfolios, pushing back their retirement timetables even as individuals dreaded for their positions.

Although employers are unlikely to be the reason for the monetary pressures the employees’ experience, they are uniquely placed to address these challenges. An ideal approach to battle the stress that accompanies monetary concerns is to get instructed (become a financial literate), structure a proper arrangement with objectives, and oversee expenses reasonably until and unless there is an achievement of the goals. 

Employers can, and should, enable their employees to do these things. And many of them already are. 

Top Companies Implementing FWP

Global brand Paypal is one of the most significant examples of overcoming adversity in American corporate history. The brand found that a considerable lump of its employees had minimal extra cash (4%-6% of full pay) after lodging, food, and transportation costs. So PayPal revealed a program to address four things: 

  • Pay compensation that underpins budgetary wellbeing and increment of total wages, 
  • Bring down the cost of benefits, termed as “regressive tax”, 
  • Put forward opportunity for everybody to be an investor and proprietor of the organization and 
  • Focus on financial management and training programs. 

Microsoft, unsurprisingly, runs a thriving financial wellness program too. Called Live Well 365, the program combines health, fitness, and financial wellness in a comprehensive package. A dedicated portal, complete with a thriving blog disseminating financial education, form part of a broader offering featuring insurance plans, health tips, and more.

Several Indian corporates – including popular brands such as Myntra, Wakefit, BigBasket, HUL, NoBroker, and many others are progressively approaching financial wellness as one of the critical precepts of employee prosperity. These associations ensure that employees can deal with their funds better and set aside savings for stormy days. 

In August 2019, Myntra introduced ‘Thrive’, a wellness framework for employees, in which financial prosperity is one of the fundamental principles. The organization is inviting experts in asset and wealth management to educate employees on ventures to spare tax, just as developing their riches for a protected future.

BigBasket (a company based out of Bangalore) has emphasized giving financial advice to lady employees. “Women have an extremely crucial role in supervising funds and interest in many families, and we started monetary literacy programs for women associates working at our distribution hubs,” Tanuja Tewari, VP of HR, BigBasket, was quoted as saying to The Economic Times. As the organization hopes to enhance its female workforce at the dissemination habitats, there are plans to teach all lady employees at the firm.

HUL runs successful financial wellness and education programs to teach representatives on the requirement for financial planning. The organization has additionally tied up with international experts for knowledge meetings on accessible financial instruments, said a representative.

Wakefit conducts internal training sessions with employees where it shares the tips and deceives of investing at a beginning phase and how a little segment of pay spared and put can go far in making sure about their future.

Conclusion 

Hopefully, this discussion was enlightening and informative. While there is a range of online loan apps for professionals, brands like EarlySalary go one step ahead – by offering financial wellness services to corporates and their employees. The result? Lowered attrition, employee turnover decreases significantly, and the employees are free of the stress and pressure.

Financial Literacy and Financial Wellness are crucial not just for the long term, sustainable growth, but, as many would agree, are also the right concepts deserving of corporate attention.

Feel free to get in touch with us for any questions on credit, loans, and your instant cash needs! We’re listening all day on:
Our Facebook Page
Our Twitter Page
Our Instagram Page
Our LinkedIn Page
Download the EarlySalary app here, or simply log in to our website and be a part of the #OneInAMillion experience.