Everything You Need to Know About Flexi Loans

Introduction

A Flexi loan is a financial product offering more flexibility than traditional personal loans. Unlike conventional loans where you receive the total amount and pay interest on the full sum, with a Flexi loan, you only pay interest on the amount you withdraw within the approved credit limit. This feature helps reduce your interest costs and offers better control over your finances, especially in situations such as medical emergencies or home renovations.

What Is A Flexi Loan & How Does It Work?

Flexi loans, also known as personal loan Flexi or loan Flexi, allow borrowers to access flexible credit up to a pre-approved limit based on factors such as credit score and income. Unlike a lump sum disbursement, you can withdraw as needed, and interest is only charged on the amount used. Flexi personal loans offer flexibility in repayments, with monthly interest payments and the ability to repay the principal amount at your convenience.

Difference Between Term Loan & Flexi Loan

A key distinction between a term loan and a Flexi loan lies in how funds are accessed and repaid. With a term loan, you receive the entire loan amount upfront and pay interest on the full sum. In contrast, a Flexi loan allows you to withdraw funds as needed, paying interest only on the amount withdrawn, providing more control over your borrowing.

Features & Benefits

• Withdrawals: Flexibility to withdraw funds as needed, ensuring easy cash flow management.
• Interest Only On Used Amount: Interest is charged only on the withdrawn amount, saving on overall interest costs.
• Free Prepayments: Ability to make part-prepayments without additional fees, reducing outstanding principal and interest.
• Lower EMI Burden: Since interest is charged only on the used amount, EMI payments are lower.
• Simple Online Transactions: Manage withdrawals and repayments online for a hassle-free experience.
• Quick Fund Availability: Once approved, funds are available for immediate use.
• No Collateral Required: Flexi loans are unsecured, so no collateral is needed, simplifying the application process.
• Long Tenure: Flexible repayment terms, allowing easier loan management over time.

Eligibility

• Citizenship: Must be an Indian citizen.
• Age: Between 21-80 years, with loan tenure ending before the age of 80.
• Employment: Employed with public, private, or multinational companies.
• Income: Minimum monthly salary of ₹25,001 based on city.
• CIBIL Score: Minimum score of 685.

Note: Eligibility criteria may vary between lenders, so it's important to check specific requirements before applying.

Documents Required

• KYC Documents: Aadhaar card, PAN card, passport, or voter ID.
• Employee ID Card: Proof of employment for salaried individuals.
• Income Proof: Salary slips for the last 3 months and Form 16 for salaried individuals; financial statements and tax returns for self-employed individuals.
• Bank Statements: Last 6 months' bank statements.
• Address Proof: Utility bills, lease agreements, driving license, or passport.

Note: Document requirements may vary based on the lender and applicant profile.

Interest Rates

Interest rates for Flexi loans typically start at 11% per annum. However, interest is only charged on the amount withdrawn, offering significant savings compared to traditional loans.

Conclusion

Flexi loans provide a flexible and cost-effective alternative to conventional personal loans. With flexible withdrawal options and interest charged only on the amount used, Flexi loans help manage irregular expenses and offer greater control over borrowing. For more information on applying for a Flexi loan, explore our tools here.