Personal loan overdraft facility allows you to withdraw funds whenever you need and is linked to your savings/current account. Usually, the lending bank sanctions a loan limit in the form of overdraft and not as a lump sum amount in the borrower’s bank account.
Personal Loan Overdraft Facility
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Wide Choice
Curated offers from 30+ lenders
Quick Disbursal
Money in your account instantly
SmartMatch
Offers ranked according to eligibility
Digital Process
Hassle-free & paperless
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How Does a Personal Loan Overdraft Facility Work
Know How It Works
Based on your eligibility and financial requirements, you apply for a personal loan overdraft from the respective lending institution.
You can withdraw funds from the sanctioned limit assigned over and above your bank balance.
The amount you overdraw can be used to meet urgent cash requirements and the interest rate is charged only on the utilized amount and not from the total assigned overdraft limit. You can even overdraw multiple times from the total OD limit.
Features of Personal Loan Overdraft
Personal loan overdraft is a flexible credit product that comes with no end-use restriction besides speculation at your disposal to meet your financial requirements. Find below the key features of personal loan overdraft facility:
Flexible repayment structure with no fixed EMIs
Eligibility Criteria
The eligibility criteria of regular personal loan and a personal loan overdraft are almost similar. Find below the basic eligibility criteria for availing a personal loan overdraft facility set by most banks and NBFCs:
Documents Required for Personal Loan Overdraft
For a Personal Loan Overdraft Facility, banks/NBFCs generally require a specific set of documents to assess the applicant’s eligibility that shall vary as per the lending institutions, which are as follows:
How Can I Apply for a Personal Loan Online?
Get up to ₹40 Lakh in 5 Simple Steps
Step 1: Enter your mobile number in the application form
Step 2: Provide your personal details
Step 3: Enter OTP to verify your mobile number
Step 4: Select the loan purpose and loan amount
Step 5: Compare offers and apply for the best-suited loan
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FAQs
What is personal loan overdraft?
Personal loan overdraft is a credit facility offered by banks and financial institutions that permits you to withdraw funds up to a pre-approved limit. You pay interest only on the utilized loan amount from the assigned limit and can be withdrawn multiple times.
Which is better, a personal loan or an OD?
Both of the credit products provide you access to avail funds at times of need. It all depends on your financial requirements and repayment ability to use and repay the funds. A personal loan is disbursed in the form of a lump sum amount and is sanctioned based on your income, credit profile, employment stability. Overdraft facility is sanctioned based on your account balance and relationship with the lender.
What is the eligibility for a personal loan overdraft loan?
The eligibility criteria of a personal overdraft is quite similar to regular personal loan, wherein the age of the applicant is usually 21 to 65 years. The salaried and self-employed individuals are eligible to apply for a personal loan overdraft with regular income and with stable job or business. Ideally, your CIBIL score should be 750 or above with a stable and continuous source of income to be eligible for a personal loan overdraft.
What is the purpose of personal loan overdraft?
The primary purpose of personal loan overdraft is to meet urgent or unforeseen financial requirements. Personal loan overdraft is mainly used to have access to short-term funds to meet immediate expenses.
What is Overdraft for salaried individuals, and how can salaried individuals avail this facility?
Overdraft for salaried is a credit facility offered by banks and financial institutions that allows salaried individuals to withdraw funds beyond their bank account balance up to an assigned credit limit.
What are the types of personal loan overdraft facilities?
The personal loan overdraft facility comes in various types, such as salary overdraft (linked to bank’s salary accounts), unsecured (no collateral required), secured (requires collateral, such as assets, FDs), and pre-approved personal overdraft issued to eligible bank customers.
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