The Indian Government has released a number of relief packages in the wake of Coronavirus spread. But, only a little of that has reached the middle class. Thankfully, many banks have come forward to lend a helping hand in the form of COVID-19 personal loans. Not only is the process of loan application is easy, but the interest rates of these loans are also lower than other personal loans.

What are 'COVID-19' personal loans?

Many banks and non-banking financial companies (NBFCs) have started to give a special type of loan. Named after the pandemic virus, these loans are called COVID-19 personal loans. The difference between a regular personal loan and a COVID-19 personal loan is that the latter's rules are somewhat relaxed.

The interest rates of regular personal loans start from 12% and go up to 20%. While the interest rates of COVID-19 personal starts from only 7% and goes up to 10%.

Right now, Bank of Maharashtra, Punjab National Bank (PNB), Indian Overseas Bank (IOB), Bank of Baroda (BoB), Indian Bank, Union Bank of India, UCO Bank, State Bank of India (SBI) and Bank of India are providing the facility of COVID-19 personal loans.

Eligibility Criteria

Different banks have different eligibility criteria. But, most of them have some commonalities. Like, you must have a salaried account or personal account with the bank. And, you must have an excellent CIBIL score.

In case you have already taken a loan with the bank, your repayment history must be good enough. Some of the banks are giving COVID-19 personal loans only to the customers who already have borrowed home loans.

Those who are self-employed can get a loan of limit up to 50% to 60% of their last filed profit, while the salaried persons can get loans of limit up to 10x of their monthly salary.

Should you take the loan?

The classic answer- Yes and No. If you are in dire need of it, you can opt for the COVID-19 personal loan. But, if you are taking the loan just because the interest rate seems lucrative- it's a big NO-NO.

The interest rates of these loans are indeed quite reasonable, but you still have to pay that in the future. You don't know when this crisis will end, and when will your business or job will get back on track. Do not pay interest rates to banks for a time period that is unknown to you.

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It's never a fun task to go from pillar to post to collect funds. After all, scrounging for money can lead to one sleepless night too many. How much has your vacant bank account or all the unpaid debts that have accumulated over the years been moving?

Well, for a personal loan you could always apply. Today, it is easier than ever to secure a personal loan, as the whole process is totally unpapered and your loan can be approved with a few days.

However, if the interest you have to pay for the loan scares you, you can borrow money here other ways without worrying about the interest spectre above you.

• Asking friends & family: While borrowing money of friends and family can be bit of a hesitation, ' it is likely time to swallow your pride and ask them to rescue you from your difficulties if you are financially in the dumps. While you're here, some grovelling might go a long way too. Usually your friends and family will help you more often than not financially and will probably not ask you to pay interest on the amount you borrowed unless it's a bunch of thieves. They also allow you to refund the amount for a significant period of time, which can give you the leeway to get back on track with your finances.

• Getting a credit card: You can use your Credit Card to make payments or purchases without paying an interest jackpot on your expenditure, whether you believe it or not. Well, it's really quite simple if you're wondering how. Credit cards give you a free interest grace period that begins with the purchase with the card, until the minimum payment has been due. The duration usually varies between 21 and 28 days. During that time, you can make payments and purchases by using your credit card without any interest.

• Balance transfers: Balance transfers are great ways to borrow money for an extended time frame without paying any interest on the amount. Check out a credit card with a rate of 0 per cent for the first 6 to 12 months or beyond. These are usually introductory rates that are offered to entice customers to make the switch from one Credit Card issuer to another.

Are you an NRI wanting to send your kids to India for studies? We will tell you how you can get an education loan!

In India, educational institutions have a NRI quota system. However, the catch is that the fees for resident students are higher. If this is the area of concern, an educational loan for NRIs can be taken care of.

What is the objective of NRI Education loan?

The goal is to meet the costs of tuition, admission, books, equipment and maintenance. The scheme also allows the financing of deposits.

Features

• A quantity of Rs for studies in India. It's going to be 4 L–20 L. Indian citizens and students who passed the entrance test or have secured entry are eligible for the course

• Eligible courses include computer courses by Department of Electronics institutions, all technical and professional courses, post-graduate and/or doctoral study courses in recognized schools, colleges and institutions. 

• Eligible courses include: For example E.g. Medical, agri scientific, veterinary, dental, architectural, computer science, industrial, business administration, etc.

• Examination costs covered by the loan would include fees payable.

• Refund: The student should begin his / her return immediately after the completion of the course for a period of one months from the date of employment, if he or she is employed at least six months after the end of the course. 

• Maximum loan repayment time: the loan to be repaid within 5-7 years following the beginning of the repayment. The maximum period of two years may be permitted if the student cannot finish the course within the time set out for finishing the course.

• If the student cannot complete the course for reasons beyond his control, the authority may consider such extensions at his discretion.

If you are a NRI and want to return your child to India for studies and you need funds, the NRI loan could help to resolve your troubles.