What are Pre-Approved Personal Loans: Interest Rates, Benefits And Eligibility

A pre-approved personal loan is a short term personal loan that is sanctioned for the existing customers of the banks as well as other non-banking financial institutions on the basis of your previous record of repayment. It is a short term credit approval with a good credit score and credit repayment history. If you possess commendable creditworthiness, you are considered to be a step closer to avail the opportunity of accessing a pre-approved personal loan.

This post discusses the features, benefits, eligibility, documents required and interest rates of pre-approved personal loans. Read to get the details before applying!

What are Pre-Approved Loans?

Pre-approved loans are personal loans that are approved by your bank before you have even applied for a loan. It is a feature that most banks offer their existing customers who have good credit scores. You do not require to offer collateral to avail of this loan. Moreover, pre-approved personal loans have less processing time and are disbursed faster, sometimes within minutes. So, what are the interest rates of pre-approved loans? Find out in the section below.

Pre Approved Loan Interest Rates

Banks or NBFCs	Interest Rates (p.a)
Navi	Starting at 9.9%
Punjab National Bank (PNB)	7.90% – 14.50%
State Bank of India (SBI)	9.60% – 13.85%
HDFC Bank	10.25% – 21%
ICICI Bank	10.25% onwards
Axis Bank	10.25% onwards
IDFC First Bank	10.49% – 23%
Kotak Mahindra Bank	10.25% onwards
Tata Capital	10.99% onwards
IndusInd Bank	11.00% onwards
IDFC First Bank	10.49% – 23%
Bajaj Finserv	13.00% onwards

*This table is used for educational purpose only.

Features & Benefits of Pre-Approved Personal Loan

Navi pre-approved personal loans have the following features and benefits:

1. Instant Approval

The entire process of loan application through Navi takes less than a few minutes (sometimes seconds). Thus, a personal loan from Navi is digitally approved, and the money is instantly transferred to your bank account.

2. 100% Paperless

There is no documentation needed for a personal loan from Navi which can double up as a pre-approved loan. Only your Aadhar Card number and your PAN number need to be entered without any hassle of uploading any documents.

3. Flexibility

A personal loan from Navi can be taken up to INR 10 lakhs which can be repaid within a tenure of 36 months. The loan is approved by Navi’s technology-driven process.

4. No Collateral

There is no need for collateral or a third-party guarantee to apply for a personal loan from Navi.

5. EMI Calculator

The online loan EMI calculators will show the net EMI amount payable every month. You can customize the loan amount and tenure to find the EMI best suited for you per your disposable income.

Eligibility Criteria for Availing Pre-Approved Loans

Usually, any personal loan financer requires you to fulfil certain minimum parameters to avail of the pre-approved loan facility. However, since Navi follows a technology-driven model to approve loans, there are no fixed eligibility criteria for the same.

Most private lenders ask for these eligibility conditions:

Age	The minimum age limit to apply for a personal loan is usually 18 years while the maximum is 65 years. For some financers, the minimum age limit can be raised to 21-25 years
Occupation	You should either be a salaried employee or a self-employed individual to avail of the loan facility.
Income	Depending on the specifications by the lenders, you should be earning the necessary amount to avail of the loan facility. The income levels may vary from lender to lender.
Credit	The minimum credit score should be 650+

Also read: How To Improve Your Credit Score

Documents Required for Pre-Approved Loans

To avail of pre-approved loans, you are required to submit certain documents to most private lenders. However, in the case of applying for a personal loan through Navi, there is no need to submit any documents. You can simply apply through your mobile application by providing your PAN and Aadhaar Card number only. There is no hassle of uploading any documents on the app.

However, in order to apply for pre-approved loans offered by other private lenders, you need to submit the following documents:

• Identity proof
• Income proof as well as bank statements, salary slips, etc.
• Age proof
• Address proof
• Recent coloured photographs

Also read: How To Apply For An Instant 15000 Personal Loan

Things to Consider Before Applying for Pre-Approved Personal Loans

• Consider asking the bank or the NBFC about the processing fee. 
• Pre-approved personal loans are valid only for a certain period of time as they are an Invitation to Apply (ITA). You must apply within that time period to avail a pre-approved personal loan.
• Compare the interest rates and processing fees of other pre-approved personal loans. 

Tips To Get Pre-Approved Personal Loan

Here are a few tips to be considered for a pre-approved personal loan:

• Maintain a good credit score. A credit score of 750 and above is considered great for getting a pre-approved personal loan at a lower interest rate.
• Keep an eye on your bank to know when they are offering pre-approved personal loans. 
• Check the features of the pre-approved personal loan.
• Compare the interest rates, processing fees and terms & conditions.

Myths About Pre-Approved Loans

Although the pre-approved loan is quite a common and popular phenomenon, yet there are certain myths regarding the same.

Assurance of Getting the Loans

There is no assurance that your loan will be granted once it is pre-approved. If your details and the necessary documents cannot be verified, loan approval might be an issue.

Receiving the Loan

If you do not accept the terms and conditions of repayment, there is no pressure on you to accept the loan. You can choose the loan amount, tenure and EMI as per your convenience and disposable income.

No Penalty

There are surely certain aspects of penalty in case you cannot meet the relevant criteria or fail to repay the loan on time, which needs to be considered. Repayment of your loan on time is extremely important as it might also affect your credit score.

Also read: A Quick Guide To Home Loan Application Process

Final Word

A pre-approved personal loan is a collateral-free borrowing option that can help secure funds at competitive interest rates from your bank. If you have a good credit score and are already an existing customer of a bank, you can get a pre-approved loan within minutes with minimal documentation. Download the Navi app on Android or iOS and apply for a personal loan now!

FAQs on Pre-Approved Personal Loan

Q1. Can you be denied a loan after pre-approval?

Ans: In case if your submitted documents cannot be verified successfully for any reason, your pre-approved loan application might be denied. However, if you apply for a personal loan from Navi, your digital verification happens instantly and since there is no hassle of uploading any documents, the loan approval would not be denied after it has been digitally approved by Navi’s technology-driven application.

Q2. Does pre-approval guarantee a loan?

Ans: No, a pre-approval can never guarantee a loan as incomplete verification of the documents provided might cancel the application.

Q3. Can a pre-approved loan be used for family marriage purposes?

Ans: A pre-approved loan is a kind of personal loan. Therefore, it is a multi-purpose loan that can be utilized for any purpose whatsoever. Even a personal loan from Navi can be used for any purpose.

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