Personal loans are becoming increasingly easier to avail these days, thanks in great measure to the ease of verification and processing that is done prior to loans being sanctioned. Personal loans fall into two broad categories – secured and unsecured.
Secured loans are usually for higher amounts such as buying a second home, property or vehicle purchase or even educational loans taken against a mortgage that is generally guaranteed against default through ‘secured’ property such as a house etc.
Unsecured loans are personal loans that are given for smaller amounts like payment of medical bills, credit card outstanding or other exigencies that require immediate cash. If you have a good credit rating it is quite easy to acquire a personal loan without any guarantees; the amount of loan depends on take-home salaries and assets that you may possess. Unsecured loans can be processed even online if all requirements are met; the repayment is done in pre-fixed, equated monthly installments with provision for foreclosure depending on the finance company that is sanctioning the loan. The advantage of a personal loan is that unlike credit card payments which are compounded interest and keeps accruing if you do not pay the installments on time, a personal loan is based on low interest rates and can be paid out quite easily. In the event of unforeseen circumstances like a job loss or personal injury resulting in loss of income, you can re-work the outstanding amount and reach a settlement in consultation with your finance company without having to wipe out your entire savings.
Although it is quite convenient to use the Internet for loan processing and installment payouts, you should be careful not to divulge too many personal details. There are many unverified and unethical finance agencies operating online that promise ‘quick loans without verification’ to those who have huge borrowings on credit cards etc. Remember that there is no guarantee that these services are authentic, safe and follow regulatory procedures and if you are not cautious, the resulting experience or loss can prove quite costly.
The first thing that many do when losing money online during a transaction is to blame the bank or financial agency. However, the technology driving the online transactions is more often to blame.
When one loses money during a transaction, one is often quick to blame her/his bank. But most such cases relate to the use of technology in banking. While technology has undoubtedly made life easier, it could prove costly if one isn’t cautious. It is advisable to check and re-check all details while conducting an online transaction because banks are not responsible if you enter wrong data entry or incorrect details. Most banks only use personal account numbers of beneficiaries while transferring funds, not the beneficiary’s name and hence it becomes a valid transaction. At the most, in the event of a wrong transaction, the bank can put you in touch with the ‘unintended beneficiary’. However, banks are quite helpful in helping customers file a complaint with the police and legal authorities and provide assistance in recovering the amount.
Do’s for safe financial transactions
• Do not disclose Debit or Credit Card PIN numbers to anyone
• Do not let others operate Debit Card on your behalf
• While settling bills with Debit Card, ensure that you go to the counter and oversee the entire transaction
• Do not post personal financial details in response to email queries or on public platforms online unless you are convinced that they are authentic and secure