FAQ on Applying Personal Loan with Aadhar Card 

Source: commons.wikimedia.org 

In 2010, the Government of India launched the Aadhar Card* to assist individuals in availing the benefits of government welfare schemes and special programmes. The Aadhaar number is basically a 12-digit number provided by the Indian Government to all the citizens of India by collecting their fingerprints and retina scan. An Aadhaar card also serves as a citizenship proof and helps individuals to open new bank accounts, apply for passport, to avail loan, to file ITR, to purchase SIM cards, and to get a Permanent Account Number (PAN) card.

Following the verdict of the Supreme Court** on the Unique Identification Authority of India’s Aadhar Card, many were confused with respect to the use of Aadhar for availing different financial services. One such area of doubt is the use of Aadhar in order to avail a loan like personal loan.

How can you avail a Personal Loan through Aadhar Card?

The Aadhar Card serves as Identity Proof and Address Proof when you are trying to avail any sort of loan including personal loan. Other identity and address proof documents can also be used to apply for a personal loan through Aadhar. These include: PAN Card, latest salary slip, profit and loss statement (in case of business) while availing the loan.  

What is the impact of Aadhar Card on any Personal Loan?

As of today, KYC (Know Your Client) documentation is quite essential in order to avail any financial services. The Government has made it mandatory for every financial institution to collect KYC details of their client to avoid money laundering cases. The KYC process has now become simpler nowadays with the introduction of Aadhar. Banks have now come up with e-KYC to digitalize the entire process of KYC. The verification process is simple and fast as the Aadhar Card contains an individual’s biometric information.  

Stringent verification was followed by both the public and private sector banks in order to pass any personal loan. Several documents had to be provided by the individual to avail a personal loan. Therefore, the approval time for the same was also lengthier. With Aadhar, the loan availing process became simpler as lesser documents were required. Since Aadhar, the loan approval time has been reduced substantially.

How to use Aadhar Card to apply for a Personal Loan Online?

It is extremely easier to avail a personal loan through Aadhar Card. It is very convenient for the bank to carry out the verification process if an individual has submitted their Aadhar Card details online. In such an e-KYC process, no physical documents have to be submitted by the individual availing the loan. Several banks offer instant personal loan to its clients if the scanned copy of Aadhar Card is uploaded. 

List of the Non-Banking Financial Companies as well as the Bank that utilize Aadhaar Card as their Main Proof of Identity

Several banks use Aadhar Card as their proof of identity for passing a personal loan to their clients. Few of them are as follows:

• HDFC Personal Loan
• Capital First Personal Loan
• SBI Personal Loan
• PNB Personal Loan
• Bajaj Finserv Personal Loan
• ICICI Personal Loan
• India bulls Personal Loan

The advantage of availing a loan through Fintech companies is that you stand a chance of getting the loan approved even if you have a low CIBIL score. The only requirement is that you need to meet their internal standards as well as submit proper documentation. Aadhar Card as well as Pan Card validate your application form and make the entire processing much faster.  

The Aadhar card makes loan processing extremely faster with minimal amount of paperwork. Therefore, Aadhar Card is the first choice of document in case one needs immediate funding. The processed loan amount is disbursed directly to the individual’s bank account. There is also no restriction with respect to the usage of the processed loan amount. The funds can be utilized to plan a foreign trip, planning a wedding, renovating your home, to fund your children’s higher education and so on. Longer loan repayment tenure makes the EMI quite manageable.

Can you utilize the Aadhar Personal Loan to consolidate debts?

Yes, you can consolidate your debts by utilising the Aadhaar Card loan. Therefore, if you have several high-interest debts, then you can get a personal loan on Aadhar Card at lower interest rates and convert them all to a single EMI. This leads to better management of your finances.

Do you require a Co-Applicant to avail an Aadhaar Card Loan?

No, you don’t necessarily need a co-applicant in order to avail an Aadhaar Card loan through. You can also contact the representatives of the firm to get more information with respect to the same. 

Is the Aadhaar Card Loan a type of an Installment Loan?

Yes, as the loan on Aadhaar Card can be referred to as an instalment loan as it involves paying fixed EMIs.