A financial emergency might happen at any time. One popular approach to deal with such challenging situations is to apply for an instant personal loan online. This gives you the finances you need to get through the crisis. But what if you have a preapproved cash limit provided by your bank that permits you to access money whenever you need it? This way, you’re always covered. This is one feature of Flexi-loans. Keep reading if you’re new to Flexi-loans and want to learn more.
What is a Flexi Loan?
Flexi-loans are a simple strategy to get credit when you need it. It serves as an alternative to personal loans. Flexi-loans provide a preapproved cash limit at a reasonable interest rate and a flexible repayment schedule. The primary benefit is that banks only charge interest on the amount you withdraw, not the whole loan amount granted. This allows you to pay just for what you use, lowering your interest costs.
What Is the Difference Between Flexi-Loans and Personal Loans?
|Flexi Loan||Personal Loan|
|Loan Amount||The lender gives a credit limit, which you can use as needed. As a result, when you seek a loan, the amount granted is deposited into your bank account. After that, you can withdraw the money from it whenever needed.||The lender credits your account with the total amount of the sanctioned loan. The money is given in a single instalment.|
|Interest Payment||You will only be charged interest on the amount you withdraw from the overall credit limit set by the bank. This way, you can save money on your interest outgo.||Here, the tenure and the interest rate applied on the loan amount are fixed. The interest is charged on the entire loan amount sanctioned.|
|Prepayment||There are zero or minimal prepayment penalties for paying off the loan early.||You must pay prepayment penalties when you make full or partial prepayments on a personal loan.|
|EMI||EMI payments vary according to loan terms, duration, prepayment, and withdrawn amount. Additionally, Flexi loans also allow you to pay interest-only EMIs. You may use this tool to reduce your monthly expenditure and free up cash for other needs.||You will be required to pay a fixed EMI amount that includes both the principal and interest. You may also use an EMI calculator to determine your EMI beforehand.|
Important Features of Flexi Loans
Some of the crucial features of the loan are listed below.
- Flexi loans are collateral-free.
- You can withdraw funds under the preapproved loan limit at any time.
- You may withdraw funds multiple times as needed. However, you can not exceed the allowed credit limit. Moreover, no further documentation is required to draw the funds.
Personal loans and Flexi loans can both help you get out of a challenging financial scenario. On the other hand, Flexi loans are more advantageous for customers who want money in staggered instalments rather than a single payment. Additionally, you may quickly obtain Flexi loans by completing the loan application form and providing the required documents for online KYC.