Banking are at the forefront to offer loans to people amid the ongoing covid crisis. The pandemic has impacted health and wealth of many and is holding the economy in its clutches pushing the unemployment rate and salary cuts. To support their customers in the hard times, banks are offering financial support through a new kind of loan.
Named ‘Covid Personal Loans’, the motive of these loans is to assist their customers who are dealing with varying degree of financial crisis. The first of its kind loan is being offered by the banks to their existing borrowers of home loan, vehicle loan or a loan against property. The customers are now extended with an unsecured personal loan. Let us understand the key features of this loan.
Who can avail?
These loans are being offered to existing salary account holders and home loan customers with a high credit score, good borrowing history and repayment records.
What is the objective?
A covid personal loan is a type of personal loan offered by banks and NBFCs for the specific purpose of tiding over the liquidity crunch during the time of the Covid pandemic. Such a situation could arise out of a lay off, salary cut, unforeseen income shortfall etc.
What is the value of Loan?
Maximum amount offered for this loan is Rs 2.5-5 lakh depending upon the monthly salary of the client and existing loan value. For example, in case of Bank of Baroda’s personal loan, a customer can approach their existing branches to avail this personal loan up to a maximum limit Rs 5 lakh.
What is the rate of Interest?
The interest rate on these loans are lower than personal loans and vary from 8%-15% per annum. The loan term also ranges from 6 months to 5 years. The relatively lower rates can be seen as some additional relief in the trying times. No prepayment fee are being levied on such loans. Moreover, no or low processing fees are charged.
How to apply?
As of now you cannot apply for a COVID-19 personal loan online. The banks offering these loans are doing so offline. Thus, you need to contact your bank directly to know the details of the COVID-19 emergency loan application process.