Did you know how the education loan will benefit you?

Education plays a pivotal role in the success of a person. Individuals who opt for graduation and higher education may often find it difficult to self-finance their studies. It is in this situation that an education loan comes handy.

Education loan is a kind of loan which is given by banks to students who apply for it after taking their credibility and merit into consideration. An education loan is given to parents, students or the spouse of the student for higher education. Higher education here maybe defined as education one seeks after higher secondary level. 

An education loan usually covers the tuition fees, examination fees, laboratory charges, hostel security, caution money, travel expenses and approximately 90% of the total expenses which need to be incurred by students for the completion of a course.

Education loans have certain benefits. They are as follows:

• Under section 80 E of the Tax Act one can file for an income tax deduction in case they have taken an education loan. (the deduction will be on the interest rate and not the principal amount)
• Approval of a student loan or education loan means that though a person may not have the required cash to complete his/her higher education, he/she may be able to complete the course. This is because the course fee is paid by the bank and the borrower who is a student will start the repayment of his/her education loan only after completing the course and obtaining employment.
• Another important benefit of a student loan is that the student does not have to depend on his/her guardian for the course fee and this does not become a financial burden on them.
• Approval of a student loan to a certain extent depends on the merit and capacity of the student himself. This means that if the borrower is academically meritorious it will be helpful in getting the loan sanctioned.
•  If you are a female student then banks offer an education loan at a relatively lower rate. The interest rate is usually 0.5% lower for a female student than her male counterparts.
• Another major advantage of student loans offered by several banks is that there is a holiday period of anywhere between 6-12 months after the completion of the degree before the actual loan repayment begins. Though, if the borrower is able to get a job early he/she may start the monthly EMIs earlier.

Education loan is a blessing for those individuals who aim to pursue higher education but who do not have the financial means to fund it.

All you need to know about corporate banking

The term corporate banking has recently gained much popularity in the banking sector of the country.  Corporate banking refers to customized and tailor- made facilities, which a commercial bank provides to large firms, listed companies or corporations who happen to be their customers.  Such corporate customers enjoy certain special facilities and services from banks, because of the large quantity of business they provide. The most important function of corporate banking is the management of working capital of the corporation that is a customer of the bank.

The main point of difference between retail banking and corporate banking is that in case of retail banking the bank deals with an individual customer and his/her individual account, but in case of corporate banking the bank is concerned with multiple accounts of the listed company or large firm together with the accounts of its employees.

The following are some of the major features of corporate banking:

• Commercial banks provide foreign exchange transaction facilities to its corporate customers. This involves currency transactions and services involving foreign investments.
• Insurance facilities are provided by commercial banks to the staff and management of the corporations apart from insuring several activities of these large firms.
• Banks provide financial advice to corporations regarding merger, taxation, expansion of functions and other such issues.
• Financing existent and new projects of the corporations by sanctioning loans, is another facility which a bank provides to its special corporate customers.
• Banks also provide regular audit facilities to large firms to keep the financial statements of the corporation in order.
• Asset custody is another important service provided by banks to corporate companies. The bank manages the bank accounts of its corporate customers. This often involves issuing status reports of the financial state of these large firms on a quarterly or annual basis.
• Banks also often buy shares of its corporate customers so that the firm is able to enjoy greater liquidity required for its functioning.

Corporate banking is one aspect of the banking sector which is gaining greater importance each day.  Corporate banking is a crucial requirement in the running of a large firm or a listed company because proper management of finance is the key to a successful company. It ensures that the business runs smoothly, helping in short run as well as long run expansion and greater profits of the company.

Corporate banking services are a basic necessity for a large company to manage, invest and diversify its existing monetary assets. It makes every day money management much easier and more effective for the company and its owners.

How to decide which banks will give you the best loan?

Banks are financial institutions who perform several key functions. Among these an important one is providing loans to its customers. An individual will opt for a bank loan when he is in need of money. Loans are of different kinds and depend on the purpose of the loan and the terms on which a loan is provided. The different types of loan include a personal loan, home loan, car loan, business loan or a secured and even unsecured bank loan. There are a variety of banks in the country that provide loans.

In order to decide the bank that provides the best loan deal, there are a few factors one must consider before-

• Minimal paperwork:
 Most people who seek a bank loan for various purposes are aware of the amount of paper work involved. This may require a lot of time. But again, certain banks are customer friendly and approve loan applications with minimal paperwork. Those banks who seek only essential paperwork before approving a loan may be opted for.

• Quick processing:
It is seen that there are certain banks who are quick, efficient and transparent while providing loans while others are not so. It is always better to opt for a bank loan from a bank which has transparent processing to avoid favoritism and partial treatment of customers.

• Repayment options:
From the point of view of the borrower a bank which provides simple and customer friendly repayment options is a bank which provides the best loans. It is seen that certain banks are more flexible with their repayment options, which means that the time provided for monthly payments is longer or the amount to be paid each month is slightly flexible. Here, the late payment penalty is also a factor. A bank which charges less penalty for late submission of the monthly EMI is better than a bank which penalizes the customer heftily.

• Interest rate:
A bank which charges a lower interest rate is better than a bank that charges more, assuming other factors like the principal amount, time period and collateral provided is the same. Often when borrowers consider different banks before seeking a loan they discover that certain banks are better in terms of loan provision because they charge a lower interest rate. Though, the difference may not be much it may matter a lot to the customer when the total amount of interest to be paid is considered.

Before opting for a bank loan, one must definitely consider the above factors to assure that they choose effectively.

Secured versus unsecured personal loan and interest rates

A borrower must always be aware of the kind of loan he/she is applying for before opting for it. A smart borrower will definitely be aware of the different varieties of loans available before deciding upon one which is most suitable for him or her.

There are basically two kinds of loans:

1. Secured loans
2. Unsecured loans

Secured personal loans:

Secured personal loans are the most common kind of loans opted for by borrowers. In case of such loans the borrower provides a collateral as a security to the lender. A collateral is anything which is valuable and which owned by the borrower. This could be some form of land or property, vehicle or even gold.  Collateral reduces the risk of the lender because it makes it possible for the lender to recover the money in case the borrower is unable to repay the loan. Again, because the lender has something of value as security, relatively lower personal loan interest rate will be charged. The lender may also be willing to loan a high amount because he has some security which provides a sort of backup in case the borrower is unable to pay back the full loan amount.

Unsecured personal loans:

When the lender lends a borrower some money without any collateral or security at his own risk, such a loan is an unsecured personal loan. In case of an unsecured loan the lender charges a high interest rate because there is risk involved. If the borrower is unable to pay the loan amount back partially or totally then the lender’s loaned amount will not be recovered. This means that a lender takes more risk in case of providing an unsecured loan. So, naturally a high personal loan interest rate will be charged.

The main points of difference between these two types of loans are:

• In case of an unsecured loan the loan amount is usually smaller and limited, but in case of a secured loan the amount may be quite high as a collateral is provided.
• For a given amount to be borrowed, a very high personal loan interest rate will be charged in case of an unsecured loan as against a secured loan.
• From the point of view of the lender higher risk is involved in case of an unsecured loan.

One can either opt for a secured loan or an unsecured loan, depending on the type of security they have. A number of business men prefer to obtain secured loans to expand their business. They generally acquire the loan against gold or land as security.

Business Loan Checklist: How to get the best loan rates

Every business needs cash flow to continue and grow steadily. Sometimes it may become difficult to have sufficient amount of cash available. In such cases, an entrepreneur can always opt for a business loan. A business loan assures this cash flow for day to day requirements of the business.

The following points can help a borrower secure a loan at a good rate:

• Keep documentation ready:
Most financial institutions seek to lookout for the business plan of the entrepreneur to check the credit worthiness of the loan.

• Build loan credibility:
A credible credit history always helps in getting business loans at interest lower rates.  A credible business history will go a long way in obtaining unsecured business loans. A decent credit score will help the business in obtaining a bank loan. By paying your credit card bills on time and by timely loan repayments one can assure that their credit score is good.

• Regularity of cashflow:
A regular and continuous cashflow is indicative of a healthy well-run business. So, if as an entrepreneur you are able to show this on then business balance sheet, you will successfully increase your chances of getting a good deal on the loan.

• Prepare a detailed plan on how the loan will be invested:
Before lending any loan amount to a business, any lender will definitely be interested to know about how the money will be used. This is because the lender wants to ensure that they will get their money back along with the interest.
Before going to a bank to seek a business loan, one must have a detailed plan about how they want to use the money to expand the business. Expansion of business, buying fixed assets, administrative use are some ways in which the credit can be fruitfully used.

• Being well prepared:
As an entrepreneur who is going to apply for a loan one should be well prepared with information about their own business. If a borrower can answer the bank’s queries satisfactorily they will be assured that you know what to do with the money. This will make them more confident about your venture. Swift and prompt answers that are well thought out, will definitely impress the lenders, and one may be able to secure a good deal on their business loan.

The above points are simple yet effective ways by which entrepreneur can assure that his business gets a loan from a bank at a good rate. This will help one run a business smoothly and carry out the expansion plans they have without any financial glitches.

Are you aware of the features of the personal loan calculator?

One of the most important functions of a bank is to provide loans to its customers. Loans are of various kinds depending on the reason for which they are being taken such as home loans, business loans, car loans and personal loans.
 
A personal loan is a loan which is given to an individual to meet his financial needs for personal reasons, such as funding a wedding or a vacation or even supplementing the current income. Each kind of a loan is provided at an interest rate. This interest rate is calculated by considering several factors making its calculation slightly tedious.  A personal loan calculator simplifies this task.

A personal loan calculator is a tool which helps you in calculating the EMI for a given loan amount, which depends on several variables. Before using the calculator, one should know about the loan amount required, the tenure of the loan and the interest rate which you will be able to pay on a monthly basis. After knowing these three answers one will be able to use the personal loan calculator efficiently.

The main features of a personal loan calculator are as follows:

• Two important areas need to be considered while opting for a personal loan – the monthly interest rate and the EMI or the equated monthly installment. It is relatively easy to calculate the monthly interest rate but calculation of EMI is a little difficult. The personal loan calculator helps in calculating both.

• This tool will help in calculating the EMI amount accurately. This is because the calculation is precise and based on the variables entered into the tool by the prospective borrower.

• Using the tool will definitely prove to be more time saving than using pen and paper, which will take a lot more time to reach the final result. Moreover it may or may not be as accurate as the one provided by the calculator.

• This calculator may be used again and again to test various combinations till one arrives to the result that suits them the best.

• A personal loan calculator is a useful tool because it will help one know about the amount they need to set aside each month to pay the EMI. One may use this tool even at the planning stage before applying for the loan, as the calculator is easily available online.

It is simple to use a personal loan calculator. One should have some information including principal amount, tenure of the loan and interest rate. By feeding this data into the calculator the EMI can be obtained.

What is a quick loan? Opt for a personal loan today

A number of banks offer their customers the option of quick loans. But what are quick loans? How do they work? Are they any different than other types of loans? Well, quick loans are just personal loans, but they are approved and sanctioned much faster. While other types of loans such as a home loan, car loan or a property loan do take quite a bit of time for approval and sanction, quick personal loans may be approved within a day or two.

Thus, a quick loan may be opted for in case of a financial emergency. One may opt for a quick loan if they urgently require funds for their business or money to pay medical bills. Quick loans are generally unsecured personal loans. With the introduction of quick personal loans one does not need to take loans from their friends and family members during any financial emergency. They only need to approach their bank for help.

There are various types of quick personal loans that one can opt for, such as-

• Same day quick loans- Such a loan is approved and sanctioned on the same day of application. This loan does not involve a credit check and only limited documentation is needed. But, in case of same day loans the interest rate charged is quite high as compared to other personal loans.
• Payday quick loans- This type of loan is for a short term and is unsecured. It is sanctioned within hours of application. In fact, one can apply for this type of a quick loan online and expect approval within 48 hours.
• Credit cards- One of the most used forms of quick loans are credit cards. In case of credit cards, one does not even require documentation in most cases.
• No-credit check quick loans- For individuals who do not have a good credit history and score, a no-check quick loan is a great option. But, in case of this type of quick loan the rate of interest charged is extremely high.

Some advantages of quick personal loans are-

• Quick approval and sanction of the loan.
• Credit history and score is not checked in most cases.
• The documentation required is minimal.
• The loans is unsecured
• One can apply for it online
• It is also given to self-employed individuals
• A quick loan can also be sanctioned to a customer who does not have any prior relationship with the bank.

While quick personal loans are definitely a boon during the time of need, one cannot ignore the high rate of interest that it comes with. Moreover, they are generally short term loans and have to be paid back fast. One should apply for a quick loan only if he can pay it back in time.