How Your Aadhaar Card and PAN Card Can Help You Get a Personal Loan

Personal loan is an effective and quicker financial tool that everyone needs. Starting from medical emergencies, wedding, travel and many more personal loan is a flexible option when anyone wants a loan but how does your aadhar card and PAN card help you get a personal loan? Let’s discuss!

What is an Aadhaar Card?

The Aadhaar card is a unique identification number issued by the Unique Identification Authority of India (UIDAI). It contains demographic and biometric data, making it a great proof of identity and address for every individual.

Did you know? An Aadhaar card consists of a 12-digit unique identification number.

What is a PAN Card?

A PAN card (Permanent Account Number) is a unique identification number issued by the Income Tax Department in India. It's required for financial transactions such as opening a bank account, filing income tax returns, buying or selling property, and conducting business above certain limits to ensure tax compliance and prevent fraud.

What is the Importance of Aadhaar and PAN in Financial Transactions?

1. Aadhaar: Aadhaar is a special number linked to biometric details, used to verify identities for tasks such as opening bank accounts and getting government benefits.
2. PAN: PAN is needed for tax purposes like filing tax returns, investing in stocks, buying property, and doing important money deals.

Role of Aadhaar Card in Personal Loan Approval

1. Simplified KYC Process

The Aadhaar card makes the KYC process easier for getting financial services. Banks can quickly check your identity and address with Aadhaar, making it faster to approve loans.

Important Note: Aadhaar-based e-KYC is quick, paperless, and hassle-free.

What is e-KYC, and how does it work?

e-KYC (Electronic Know Your Customer) is a paperless way to verify your identity and address using Aadhaar. It allows instant verification for opening bank accounts, getting mobile connections, or other services, reducing paperwork and time.

Why is KYC important for personal loans?

KYC (Know Your Customer) is important for personal loans to verify the borrower's identity, address, and financial background. It helps lenders assess the borrower's creditworthiness, prevent fraud, and comply with regulatory requirements.

2.Digital Verification

Aadhaar-based verification allows for digital authentication, reducing the need for physical documents. This digital process is secure and helps in faster processing of loan applications.

Important Note: Digital verification through Aadhaar ensures a secure and swift process.

3.Linking Bank Accounts

Aadhaar can be linked to your bank account, making it easier for lenders to verify your financial history and current financial information. This linkage helps in assessing your loan eligibility and repayment capacity.

How do I link my Aadhaar to my bank account?

1. Visit your bank's branch.
2. Fill out the Aadhaar linking form or provide your Aadhaar number.
3. Submit the form and necessary documents like Aadhaar card copy.

What are the advantages of linking Aadhaar to my bank account?

1. Direct Benefit Transfers: Enables direct deposit of government subsidies, pensions, and other benefits into your bank account.
2. Digital Transactions: It can help in seamless digital transactions and payments using Aadhaar-based authentication.
3. KYC Simplification: Optimize the KYC (Know Your Customer) process for opening and operating bank accounts, making it more convenient.​

Role of PAN Card in Personal Loan Approval

1. Financial Identity Verification

The PAN card is important for confirming your financial identity. It's connected to your money dealings, tax filings, and credit record, so lenders use it to judge your loan request.

2. Credit Score Assessment

Lenders use the PAN card to review your credit score, which decides if you get a loan. Your credit score shows how well you manage loans and debts, affecting how much loan you can get and at what interest rate.

What credit score is considered good for personal loan approval?

Answer: 750 or above considered as a good credit score.

1. Tax Compliance Verification

Because the PAN card is linked to your tax records, it helps lenders confirm your income and tax honesty. This check assures them that you have a steady income and can pay back the loan

Combined Benefits of Aadhaar and PAN for Personal Loans

1.Faster Loan Approval

Using both Aadhaar and PAN cards can make getting a loan faster. Aadhaar checks your identity fast, and PAN shows your money history, making the whole process quicker.

2.Enhanced Loan Eligibility

Having both Aadhaar and PAN cards can improve your chances of getting a loan. Lenders can quickly check your identity, financial stability, and credit history, which can lead to better loan terms and higher chances of approval.

What factors do lenders consider for loan eligibility?

Several factors are considered such as your income, debt to income ratio, CIBIL Score, employment history and many others.

3.Reduced Documentation

Using Aadhaar and PAN makes applying for a loan easier because you don't need many documents. Aadhaar checks your identity digitally, and PAN confirms your financial details, making the process simple and clear.

Summary

Conclusion

Using your Aadhaar and PAN cards can make getting a personal loan much easier and faster. These cards confirm who you are and your money history, helping lenders decide about your loan. With Aadhaar and PAN, you might get faster approval, qualify for better loans, need less paperwork, and get better terms. Whether you need a loan for medical bills, school, or anything else, Aadhaar and PAN can help you get the money you need quickly and easily.

We EasyBankLoan understand the process of procuring a loan can be stressful. That is why we take care of your loan application process, saving you time and hassle by handling the paperwork and communication with the loan providers.

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Need help? Reach out at support@eazybankloan.com

Frequently Asked Questions FAQs

1.How do I link my Aadhaar card to my bank account?

• To link your Aadhaar card to your bank account, you can visit your bank's branch with your Aadhaar card and bank passbook, or you can do it online through your bank's internet banking portal by following the instructions provided.

2.What credit score is considered good for personal loan approval?

• A credit score above 750 is generally considered good for personal loan approval.

3.How does my PAN card help in getting a better interest rate on a personal loan?

• Your PAN card helps lenders access your financial history, credit score, and tax records. A good credit score and clean tax record can lead to better interest rates as it reduces the lender's risk.

4.What is the difference between e-KYC and regular KYC?

• e-KYC is an electronic version of the Know Your Customer process using Aadhaar-based verification, which is quicker and paperless. Regular KYC involves physical submission of documents for identity and address verification, which is time-consuming.