Loan on PAN Card Complete Guide To The Best Offer!

PAN (Permanent Account Number) is an identification tool that gives lenders a complete image of your credit behaviour. It is a 10 character alphanumeric ID issued by the Income Tax Department of India.

A PAN card helps the government of India to monitor all monetary transactions of Indian citizens and  stop any transaction that happens out of the legal framework.

With the digital revolution and easy to access loan processes, it has become mandatory to link your PAN card with all your bank, finance and other necessary documents. This process has made it easier for the lender to check your PAN for KYC(know your customer) making PAN card an important source to get a loan.

But how will I get a pan card loan? Keep reading this!

Features & Benefits of Loan on PAN Card

Getting a PAN card loan is easier than traditional ways because it illustrates the credit profile and transaction history of a borrower. With a good research and understanding of the PAN card loan application process you can find options and choose only what suits you better.

Let’s understand more about the features and benefits of availing loan on PAN card: :

1. Unsecured Loan: Loans availed on PAN card are unsecured. Which means you don’t have to pledge any assets to secure the loan.
2. Fast Disbursal: Loan amount gets disbursed sooner. Given PAN provides more in-depth information about the applicant. PAN is useful to access data related to tax, employment and important transactions.
3. Repayment Tenure: Borrower is free to choose loan amount, repayment tenure and the interest rates that suit their plans better.
4. Wide Range of Lenders: Wide range of lenders: There are many lenders offering PAN card loans, so you can compare and shop around to find the best deals for you.
5. Transparent terms and conditions: The terms and conditions of PAN card loans are typically transparent, so you know what you are getting into.

Eligibility & Documents Required for PAN Card Loan

The eligibility criteria for a personal loan on a PAN card vary from lender to lender, but typically include:

• You must be a citizen of India.
• You must be between the ages of 21 and 60 years.
• You must have a PAN card.
• You must have a good credit score.
• You must have a regular source of income.

Note: The specific eligibility criteria may also depend on the lender and the amount of loan you are applying for. For example, some lenders may require a higher credit score for a larger loan amount.

Documents Needed To Get Personal Loan on PAN card:

• Identity Proof (such as your passport or driver’s license)
• Address Proof(such as a recent utility bill)
• Income Proof (such as your salary slips or business tax returns)

Additionally, there are some other basic criteria to cover while applying for loan:

• Employment status: To be eligible, you must have a steady income and be employed or self-employed.
• Debt-to-income ratio: Your debt-to-income ratio should be below a certain threshold. This means that your monthly debt payments should not exceed a certain percentage of your monthly income.

For example, let’s say an individual in India has the following financial situation:

Gross Monthly Income: ₹50,000

Monthly Housing Loan EMI: ₹15,000

Monthly Car Loan EMI: ₹8,000

Credit Card Minimum Payment: ₹5,000

Other Monthly Expenses: ₹10,000

To calculate the DTI:

Total Monthly Debt Payments = Monthly Housing Loan EMI + Monthly Car Loan EMI + Credit Card Minimum Payment = ₹15,000 + ₹8,000 + ₹5,000 = ₹28,000

DTI = (₹28,000 / ₹50,000) x 100 = 56%

In this example, the individual’s DTI is 56%. This means that 56% of their monthly income is dedicated to repaying debts. A lower DTI is generally preferred, as it indicates a lower risk of defaulting on additional debt obligations.

Housing status: If you own a home, you may be eligible for a lower interest rate on your loan.

Did You Know: Getting a Pre-approved loanIf you are not sure if you are eligible for a personal loan on the PAN card, you can contact a lender and ask for a pre-approval. This will give you an idea of how much money you can borrow and what the interest rate will be.

Also Read: Understanding PAN 2.0

Apply for a PAN Card Loan

Given below is the step-by-step guide to avail loan on PAN card. Keep in mind to collect all the documents in advance and keep them for future reference.

Let’s go into it:

1. Choose a Lender:There are many lenders that offer PAN card loans, so it is important to compare different options before you choose one. Some factors to consider include the interest rate, the loan amount, the repayment terms, and the lender’s reputation.
2. Gather the required documents: Lenders require original documents, but usually you need to give them your PAN card, Aadhaar card, income papers, and bank statements.
3. Fill out the loan application form: The loan application form will ask for your personal and financial information. Be sure to read the form carefully and answer all of the questions accurately.
4. Submit the application form and documents: You can submit the application form and documents online or in person at the lender’s office.
5. Wait for the lender to approve your loan: The lender will review your application and documents and let you know if your loan is approved.
6. Sign the loan documents: Once they approve your loan, you will need to sign the loan documents. These documents will outline the terms of your loan, such as the interest rate, the loan amount, the repayment terms, and the penalties for late payments.
7. Receive the loan amount: Once you have signed the loan documents, the lender will disburse the loan amount in your bank account.

Key Points To Remember While Applying For Loan:

Loan on PAN card is comparatively easy to process than other loans. As PAN holds a majority of the key information. So before concluding our blog, let’s look into some additional features to keep in our mind.

1. Credit Score: Your credit score is a number that lenders use to assess your creditworthiness. A good credit score will help you get a lower interest rate on your loan. You can check your credit score for free at a number of websites.
2. Income: Lenders will check that you have a steady income that can support the monthly payments on the loan. They will typically ask for proof of income, such as your salary slips or tax returns.
3. Debt-to-Income Ratio: Your debt-to-income ratio is the percentage of your monthly income that goes towards debt payments. Lenders will review your debt-to-income ratio to ensure it is not too high, as this may suggest that you have too much debt.
4. The Purpose of the Loan: Lenders might enquire on the what you need the loan for. If you are borrowing money to merge debt or finance a major purchase, they may be more likely to approve your loan.
5. The Loan Amount: The amount of money you borrow will depend on your needs and your ability to repay. It is important to borrow only what you need, as taking on too much debt can be a financial burden.
6. The Interest Rate: The interest rate is the amount of money you will pay in interest over the life of the loan. It is important to compare interest rates from different lenders before you choose one.
7. The Repayment Term: The repayment term is the time you have to repay the loan. It is important to choose a repayment term that you can afford.
8. The Fees: There may be fees associated with taking out a loan, such as an origination fee or a prepayment penalty. Be sure to ask about all the fees before you sign the loan documents.

These key pointscan increase your chances of getting approved for a loan on the PAN card and getting the best possible terms.

PAN (Permanent Account Number) is not just a random combination of numbers and letters; it’s your financial passport to a world of opportunities. Your PAN is more than just an identification number; it’s your key to financial empowerment.

A loan on a PAN card can be a great way to finance your needs. But it’s important to do your research and understand the terms and conditions before you sign on the dotted line.

This blog has highlighted everything that you need to know about PAN card loan,Will you apply for a loan on a PAN Card or will do you have other suggestions?

Tell us in the comments below!

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Frequently Asked Questions

Q. What is the minimum and maximum loan amount on a PAN card?
A.The minimum loan amount on a PAN card is typically around Rs. 10,000, while the maximum loan amount can go up to Rs. 50 lakhs or more, depending on the lender and the borrower’s creditworthiness. 

Q. How much loan can I get on my PAN card?
A. The typical loan amount ranges from Rs. 10,000 to Rs. 50 lakhs

Q. How do I know loans on my PAN card?
A. You can check the loans on your PAN card by getting your credit report.

Q. How to get a Rs 2000 loan instantly without a PAN card?
A. It is possible to get a Rs 2000 loan instantly without a PAN card, but the interest rates and fees will be higher than if you had a PAN card.