Overdraft Personal Loan

A 10-lakh personal loan is an appealing credit option. As many banks are presently offering digital applications, you can apply and secure the necessary funds without visiting bank branches. Moreover, there’s no need to pledge any collateral. Moreover, most banks nowadays ensure that eligible applicants can expect fund disbursement within a day or two, further enriching the overall appeal of this borrower-friendly personal finance. It is ultimately recognised as a multi-purpose personal loan. I.e., you are allowed to apply any of your personal needs, and banks are typically ready to sanction your loan application in a jiffy. Let's scroll down to know more about this 10 lakh loan.

A bank overdraft facility is a service provided by banks to their account holders. Those who meet eligibility criteria can withdraw funds up to a specified limit, even if their current balance is zero. These limits may be influenced by your credit profile and past banking transactions. You can repay the amount at your convenience without being tied to a fixed EMI schedule. However, similar to other credit options, repaying the borrowed funds along with the applicable interest rate is a requirement. Keep scrolling to learn more.

Features and Benefits of Personal Loan Overdraft Facility

Here are the applicable features and benefits of an Instant overdraft facility personal loan:

• Easy repayment options: You can pay the interest component monthly and the principal amount as per your cash flow.
• Multiple withdrawals: You can withdraw and repay the loan amount multiple times within the sanctioned limit, without any extra charges.
• Fixed or dropline limit: Depending on the lender, you can opt for a fixed limit that stays the same throughout the loan tenure, or a dropline limit that decreases gradually over time.
• Simple documentation: The paperwork and verification process for an overdraft facility personal loan is minimal and hassle-free.

Interest Rate for Personal Loan Overdraft Comparison

The interest rate for personal loan overdrafts varies depending on the lender, the loan amount, the credit profile of the borrower, and other factors. In general, the interest rate for a personal loan overdraft is higher than the interest rate for a regular personal loan, as it offers more flexibility and convenience to the borrower. However, the borrower only pays interest on the amount they use, not the entire limit, which can help them save on interest costs.

Here are the leading banks in India which offer Flexi Personal Loans:

Variable vs. Fixed Rates

Let’s examine the differences between variable rates and fixed rates regarding overdraft loans:

How Does the Overdraft Facility Loan Work?

The following outline describes the typical procedures for how an overdraft facility loan works:

• You can apply for an overdraft facility loan from a lender that suits you best, and get approved for a certain limit based on your eligibility.
• You can withdraw money from your loan account anytime you need, up to the sanctioned limit, using online banking, mobile app, cheque, or ATM.
• You pay interest only on the amount you withdraw, not on the entire limit, at either a fixed or variable rate, depending on your chosen lender. The interest is calculated daily and is billed monthly to your loan account.
• You can repay the loan amount in full or in part, whenever you have surplus funds, without any prepayment charges. You can also withdraw the repaid amount again, as long as it is within the limit and the loan tenure.

Eligibility Criteria

The eligibility criteria for an overdraft facility can vary based on the lender, account type, limit amount, and collateral provided. However, some of the common eligibility criteria for a bank instant OD facility are as follows:

• The applicant must be an Indian citizen.
• The applicant must be somewhere between 21 and 65 years old.
• The applicant must have an existing bank account with their chosen lender.
• You applicant must have a good credit score and repayment history.
• The applicant must have a regular source of income that meets the criteria set by the lender.

Documents Required for a Flexi Personal Loan

To apply for a personal loan overdraft facility, you need to submit the following documents:

• Proof of Identity:  PAN Card (mandatory), Aadhaar Card, Driving licence, or Passport.  
• Proof of Address: Utility Bills, Voter ID Card, or Ration Card.
• Proof of Income: Bank statement, salary slip, income tax return, etc.

Apply for Overdraft Facility

You can initiate your overdraft loan application through Urban Money’s official website. Alternatively, you can contact our loan specialist by dialling 1800 208 3344, who will be happy to guide you until you secure the necessary funds. Our team of experts strives to provide you with a quick solution and help you make the entire process smoother. 

Let’s take a look at a list of features you can expect from an instant personal loan of ₹10 Lakhs:

• Multi-purpose credit option
• Collateral-free finance
• Competitive interest rate
• Flexible repayment term 
• Online application process
• Quick approval and disbursal