NBFC Personal Loan: Bank Loans vs NBFC Loans

NBFC Personal Loan: Bank Loans vs NBFC Loans

With Bajaj Finance, you can check your pre-approved loan offer in just 2 steps and experience the NBFC advantage – quick approval, minimal documentation, and competitive rates.

Rs. 40000 - Rs. 55 lakh

You may be eligible for a pre-approved offer

Enter mobile and OTP | Check offer | No branch visit needed

Personal loans by NBFC

Non-banking financial companies (NBFCs) have transformed the lending landscape in India with their personalized offerings, broader reach, robust risk management frameworks, innovative co-lending agreements, and dynamic digital presence. This evolution has significantly boosted the adoption of their credit facilities across the country.


With Bajaj Finance, you can check your pre-approved loan offer in just 2 steps and experience the NBFC advantage – quick approval, minimal documentation, and up to Rs. 55 lakh at competitive rates starting from 10%* p.a.


Read on to discover why millions of borrowers now prefer an NBFC loan over traditional bank loans, and how this shift is making credit more accessible and convenient for everyone.

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Advantages of getting a personal loan from NBFC

  • Easy eligibility criteria

    For an NBFC loan, you don't have to navigate through lengthy or complicated eligibility criteria for personal loans that traditional lenders typically impose. The primary parameter that these progressive lenders consider is your credit score and overall financial profile.


     

    A minimum CIBIL score of 685 or higher can get you instant approval with most reputable NBFCs. But here's the good news – even those with lower credit scores can still apply and get approved by demonstrating substantial monthly income, stable employment, and a promising career portfolio.


     

    Why this matters: In sharp contrast, the eligibility terms set by traditional banks remain quite stringent and inflexible, especially for self-employed applicants, freelancers, or those with non-conventional income sources.


     

    Pro tip: NBFCs often look at your overall financial picture rather than just checking boxes, making them more inclusive and understanding of individual circumstances.

  • Minimal to nil documentation

    Here's where NBFCs truly shine! Existing or pre-approved customers often don't need to submit any documents when applying for a personal loan with a reputable NBFC. For new customers, the document requirements are refreshingly limited to basic OVDs (Officially Valid Documents) for KYC Verification, recent bank account statements, and the latest salary slips.


    Contrast this with other lending institutions, where both existing and new customers typically have to submit extensive, lengthy paperwork that can be overwhelming. Traditional lenders usually require additional documents from self-employed applicants, including business registration papers, tax returns, profit-loss statements, and more.


    Smart advantage: This streamlined documentation process means you can apply and get approved without the stress of gathering dozens of documents or making multiple trips to the lender's office.


     

  • Quick approval

    Pre-approved customers can receive loan approval within a few minutes of applying with the best NBFC for a personal loan. In other cases too, you can get an unsecured loan approval in just 5 minutes* from reputed NBFCs.

    This is not usually the case with traditional lenders, as they have more internal processes to comply with before approving an application.

  • Swift processing and disbursal

    Leading NBFCs can process and disburse loan applications within one working day after approval. Borrowers can receive the money directly in their bank account in under 24 hours* with select non-banking financial companies. This makes NBFC loans the ideal funding option for urgent financial needs such as medical emergencies, sudden home repairs, or time-sensitive opportunities.


    Real-world impact: When you need funds urgently – like for a medical emergency or to grab a limited-time investment opportunity – every hour counts. NBFCs understand this urgency and have built their processes accordingly.


    The disbursal time for a personal loan from traditional lenders may extend anywhere between several days to a few weeks, making them unsuitable for urgent financial needs.

  • Completely online application process

    Modern NBFCs like Bajaj Finance offer a 100% digital and completely paperless application process that you can complete from the comfort of your home. You only need to provide basic details such as your name, phone number, and city to initiate the procedure of applying for an NBFC loan online.

  • Exceptional customer service

    Last but certainly not least, NBFCs have built their reputation on superior customer service that you can actually rely on. These progressive lending companies usually assign a dedicated customer relationship manager who is available to assist and guide you before, during, and after applying for or receiving an NBFC personal loan.

For all these compelling reasons, opting for an NBFC personal loan is increasingly seen as the smarter, more convenient option. You can also typically get an instant personal loan of higher amount from an NBFC (based on your eligibility) compared to what a traditional lender might offer.


Apply for a personal loan with Bajaj Finance to get attractive features and benefits at competitive interest rates. You can also use our personal loan EMI calculator to compute your monthly repayments in advance and choose the loan amount that perfectly suits your budget and financial goals.

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Types of NBFCs

Understanding the different types of NBFCs in India helps you choose the right lender for your specific needs:


  • Deposit-taking NBFCs (NBFC-D): Can accept public deposits like banks
  • Non-deposit-taking NBFCs (NBFC-ND): Cannot accept deposits but offer various lending services
  • Asset Finance Company (AFC): Specializes in financing physical assets like vehicles and equipment
  • Loan Company (LC): Focuses primarily on providing different types of loans
  • Investment Company (IC): Deals with securities, stocks, and investment products
  • Infrastructure Finance Company (IFC): Finances large infrastructure projects
  • Systemically Important NBFCs (SI-NBFCs): Large NBFCs with significant impact on the financial system
  • Microfinance Institutions (MFI): Provides small loans to underserved populations
  • Housing Finance Company (HFC): Specializes in home loans and housing finance
  • Core Investment Company (CIC): Holds investments in group companies
     

Bajaj Finance operates as a systemically important NBFC, which means we're regulated closely and have the financial strength to serve millions of customers reliably.

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Eligibility criteria and documents for personal loan from NBFC

    • Nationality: Indian
    • Age: 21 years to 80 years.
    • Employed with: Public, private, or MNC.
    • CIBIL Score: 685 or higher.
    • Customer profile: Self-employed or Salaried

    *You should be 80 years or younger, at the end of the loan tenure.

  • Documents required

    The documentation requirements for a personal loan can vary from lender to lender. Below are the documents that are required to be submitted when applying for a Bajaj Finserv Personal Loan:


    • KYC documents: Aadhaar/ passport/ voter’s ID/ driving license/ Letter of National Population Register/ NREGA job card
    • PAN card
    • Employee ID card
    • Salary slips of the last 3 months
    • Bank account statements of the previous 3 months
    • Piped gas bill
    • Pension order
    • Letter of Allotment of Accommodation Issued by Employer
    • Property / Municipal tax receipt
    • Utility bill
    • Phone bill
    • Real-time image / photograph
    • Ration card

    Check your eligibility for personal loan using just mobile number and OTP – 100% online process. 

Why an NBFC loan may be a better option than bank loans?

Non-Banking Financial Companies (NBFCs) offer certain advantages over traditional bank loans, making them a preferred option for some borrowers. One advantage is flexibility in lending criteria, allowing individuals with lower credit scores or unconventional income sources to access financing. NBFCs often have faster approval processes and less stringent documentation requirements than banks, making them suitable for borrowers seeking quick access to funds. Additionally, NBFCs may specialize in niche markets or offer specialised products tailored to specific needs, providing borrowers with more options. However, borrowers should carefully consider interest rates, terms, and fees before choosing between NBFCs and banks.

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Key offerings: 3 loan types

Personal loan interest rate and applicable charges

Type of fee

Applicable charges

Rate of Interest per annum

10% to 31% p.a.

Processing fees

Up to 3.93% of the loan amount (inclusive of applicable taxes).

Flexi Facility Charge

Term Loan – Not applicable

Flexi variant - A fee will be deducted upfront from the loan amount (as applicable below)

  • Up to Rs. 1,999/- for loan amount less than Rs. 2,00,000
  • Up to Rs. 3,999/- for loan amount from Rs. 2,00,000 to Rs. 3,99,999
  • Up to Rs. 5,999/- for loan amount from Rs. 4,00,000 to Rs. 5,99,999
  • Up to Rs. 7,999/- for loan amount from Rs. 6,00,000 to Rs. 9,99,999
  • Up to Rs. 8,999/- for loan amount from Rs. 10,00,000 to Rs. 14,99,999
  • Up to Rs. 9,999/- for loan amount from Rs. 15,00,000 to Rs. 19,99,999
  • Up to Rs. 10,999/- for loan amount from Rs. 20,00,000 to Rs. 24,99,999
  • Up to Rs. 11,999/- for loan amount from Rs. 25,00,000 to Rs. 29,99,999
  • Up to Rs. 12,999/- for loan amount of Rs. 30,00,000 and above

*All the Flexi facility charges above are inclusive of applicable taxes

*Loan amount includes approved loan amount, insurance premium, and VAS charges.

Principal Holiday Facility Fees
  • Up to Rs.1999/- for loan amount less than Rs.2,00,000
  • Up to Rs.3999/- for loan amount from Rs. 200000 to Rs.399999
  • Up to Rs.5999/- for loan amount from Rs. 400000 to Rs.599999
  • Up to Rs.7,999/- for loan amount from Rs. 600000 to Rs.999999
  • Up to Rs.8,999/- for loan amount from Rs.10,00,000 to Rs. 1499999
  • Up to Rs. 9999/- for loan amount from Rs. 15,00,000 to Rs.19,99999
  • Up to Rs.10,999/- for loan amount from RS. 20,00,000 to RS.2499999
  • Up to Rs.11,999/- for loan amount from RS.25,00,000 to RS. 29,99999
  • Up to Rs. 12,999/- for loan amount of Rs.30,00,000 and above

Above charges are inclusive of applicable taxes & will be deducted upfront from loan amount

*(Loan amount includes approved loan amount, Insurance Premium & VAS Charges)

Bounce charges

Up to Rs. 1,200 per bounce.
“Bounce charges” shall mean charges for (i) dishonour of any payment instrument; or (ii) non-payment of instalment (s) on their respective due dates due to dishonour of payment mandate or non-registration of the payment mandate or any other reason

Pre-payment charges

Full pre-payment

  • Term Loan: Up to 4.72% (inclusive of applicable taxes) on the outstanding loan amount as on the date of full pre-payment.
  • Flexi Term Loan (Flexi Dropline): Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment.
  • Flexi Hybrid Loan: Up to 4.72% (inclusive of applicable taxes) of the total withdrawable amount as per the repayment schedule as on the date of full prepayment.

Part pre-payment

  • Term Loan: Up to 4.72% (inclusive of applicable taxes) of the principal amount of loan prepaid on the date of such part pre-payment.
  • Not Applicable for Flexi Term Loan (Flexi Dropline) and Flexi Hybrid.

*Foreclosure will be processed post clearance of first EMI

Penal charge

Delay in payment of instalment(s) shall attract Penal Charge at the rate of up to 36% per annum per instalment from the respective due date until the date of receipt of the full instalment(s) amount.

Stamp duty (as per respective state)

Payable as per state laws and deducted upfront from loan amount.

Annual maintenance charges

Term Loan: Not applicable

Flexi Term Loan (Flexi Dropline): Up to 0.295% (inclusive of applicable taxes) of the total withdrawable amount (as per the repayment schedule) on the date of levy of such charges.

Flexi Hybrid Loan: Up to 0.295% (inclusive of applicable taxes) of the total withdrawable amount during the initial tenure. Up to 0.295% (inclusive of applicable taxes) of total withdrawable amount during subsequent tenure.

Broken period interest / Pre-monthly Instalment interest

Method of recovery of "Broken Period Interest/Pre monthly instalment Interest" would be as follows:


EMI Date : 2nd

Scenario 1: If Loan is disbursed on 1st or post 10th of the month:

For Term Loan: BPI amount will be capitalised, i.e added to Principal amount on Due date / Deducted from disbursement
For Flexi Loans: BPI amount will be capitalised, i.e added to Principal amount on Due date / Added to first instalment

Scenario 2: If Loan is disbursed between 3rd and 10th of the month:
First instalment will consist of interest for actual number of days

Note: Additional cess if any, will be applicable to all charges according to state law.

*Terms and conditions apply.

Disclaimer

Bajaj Finance Limited has the sole and absolute discretion, without assigning any reason to accept or reject any application. Terms and conditions apply*.