The evolution of digital short-term loan apps has made lending much more convenient and easily accessible for everyone. You no longer have to stand in long queues in order to submit your loan application. Also, you don’t have to wait for days or weeks to get the loan amount disbursed into your account. With online short-term loan apps, these processes are now much faster and hassle-free.
However, like every coin has two sides, these short-term loan apps also have their own advantages and disadvantages. It is true that the benefits of these loan apps are more than their drawbacks. However, before you apply for a loan any any short-term loan app, you must be aware of both the advantages and disadvantages. Let us discuss the same in detail through this article:
Advantages of Short-Term Loan Apps
Below are some of the pros of instant online personal loan apps:
1. Easy to Access
The online short-term loan apps are easily accessible as anyone can access them anytime using their mobile devices. Rather than offline loans that require you to be present at the bank or the financial company’s branch, these short-term loan apps make the entire lending process digital. You can apply for loans and get approved from the comfort of your home.
2. Flexibility
Short-term loan apps offer a higher flexibility compared to traditional offline loans. With most of these apps, users get to choose the loan amount, EMIs, and repayment tenures at their convenience. Also, some best short-term loan apps like FatakPay offer monthly credit lines, allowing users to spend only the required amount. All these features make digital loan apps much more flexible and hence convenient for users.
3. Hassle-Free Application Process
Unlike offline personal loans, the application process for digital loans is much easier and hassle-free. You can easily sign up for the app, enter a few basic details on your mobile, upload basic documents, and get done. The need for lengthy applications and unnecessary documentation has been eliminated by these apps.
4. Less Strict Eligibility Requirements
The eligibility criteria for short-term online loans are less strict than those for the offline loans offered by loans and larger financial companies. Banks require you to have a good credit score, preferably above 700 in order to approve your loan application. Apart from this, there are several other eligibility requirements that you need to fulfill.
But that is not the case with digital loan apps. Even those with low credit scores can get short-term loans from these apps. FatakPay, which is a reputed short term loan app in India, is known for offering loans and credit lines with minimal documentation and minimal credit score requirements.
5. Quick Disbursal
Online short-term loan apps quickly process your loan application and approve it within just a few minutes. If all your details are correct and you fit the basic criteria, your loan will be disbursed within just 10-15 minutes with instant loan apps like FatakPay. This can take up to a few weeks in the case of traditional offline loans.
Disadvantages of Short-Term Loan Apps
Now that you have understood the benefits of digital personal loan apps, let us discuss their downsides:
1. Smaller Amounts
Short-term loan apps are a good choice for those who are looking for small amounts to manage their daily or monthly expenses in emergency situations. You can apply for these small loans in case of a medical emergency, unplanned expense, basic home renovation, etc. These might not be suitable for you if you are looking for bigger loan amounts.
2. Potential for Overspending
There is always a risk of overspending with short-term loan apps that offer monthly credit lines. If you have a high monthly credit line, you may end up overspending at times. Therefore, it becomes essential to use these apps carefully and responsibly. If you are responsible enough to stop spending when it goes beyond your repayment capacity, there is nothing wrong with using these apps.
Conclusion
As you can clearly see, there are more advantages to using short-term loan apps than disadvantages. The only considerable drawback is that these apps usually approve smaller loan amounts. If that is what you need, you can undoubtedly go for a digital personal loan. But make sure to do some research about the app’s fees & charges and terms & conditions. Some loan apps can charge unnecessarily high processing fees and interest rates.
