Flexi Loans are a relatively new concept in the world of lending, and they’re becoming increasingly popular. But what exactly are they, and how do they differ from personal loans? In this article, we’ll explore the differences between Flexi Loans and Personal Loans, their features, and what they mean for borrowers.
Contents
What is a Flexi Loan?
A Flexi Loan is a type of loan that allows borrowers to withdraw funds as and when they need them, up to a pre-approved limit. Borrowers can make multiple withdrawals and repayments as long as they don’t exceed the limit, and interest is only charged on the amount borrowed. This means that borrowers have access to a pool of funds that they can use whenever they need to without having to apply for a new loan every time.
What Is the Difference Between Flexi-Loans and Personal Loans?
The key difference between Flexi Loans and Personal Loans is the flexibility they offer. Personal loans have a fixed amount that is disbursed to the borrower, and the interest rate is calculated on the entire amount borrowed. Once the loan is repaid, the borrower needs to apply for a new loan if they need more funds.
Flexi Loans, on the other hand, offer borrowers a pre-approved limit that they can use whenever they need to. Interest is only charged on the amount borrowed, which means that borrowers can save money on interest charges if they don’t use the entire limit. Additionally, borrowers can make multiple withdrawals and repayments as long as they don’t exceed the limit, which gives them greater control over their finances.
Features of Flexi Loans
- Interest-Only Repayments: Flexi Loans offer borrowers the option to make interest-only repayments, which means they only pay the interest charged on the amount borrowed. This can help borrowers manage their cash flow and reduce their monthly repayment amount.
- Pre-approved Limit: Flexi Loans come with a pre-approved limit that borrowers can use as and when they need to. This gives them access to a pool of funds that they can use to manage their finances without having to apply for a new loan every time.
- Multiple Withdrawals and Repayments: Borrowers can make multiple withdrawals and repayments as long as they don’t exceed the pre-approved limit. This gives them greater control over their finances and the ability to manage their cash flow more effectively.
- No Collateral Required: Flexi Loans are unsecured loans, which means that borrowers don’t need to provide any collateral to secure the loan. This makes them an attractive option for borrowers who don’t have any assets to use as collateral.
- Lower Interest Rates: Flexi Loans typically have lower interest rates compared to other types of loans, such as credit cards or personal loans. This is because the interest is only charged on the amount borrowed, which reduces the overall interest cost for the borrower.
Conclusion
Flexi Loans offer borrowers greater flexibility and control over their finances compared to personal loans. With a pre-approved limit, multiple withdrawals and repayments, and interest-only repayments, borrowers can manage their cash flow more effectively and save money on interest charges. Additionally, the fact that Flexi Loans are unsecured means that borrowers don’t need to provide any collateral to secure the loan. Overall, Flexi Loans are a great option for borrowers who need access to funds on an ongoing basis and want to avoid the hassle of applying for a new loan every time they need money.