Our new year resolutions often include managing money in a better fashion. This many a time includes either keeping aside a certain percentage of our income or starting an investment plan. All these are efforts made towards accumulating wealth in order to lead a better life.
However, life is unpredictable and we must be prepared to deal with unforseen circumstances. And in order to address such events, at times we might need to fall back upon loans including unsecured ones like personal loans. For example, at times it becomes necessary to resort to personal loans to treat a disease.
Needless to say with digitization disrupting our lives like never before, availing loans have become simple. There is no need to stand in long queues or even wait for months to receive a loan sanction from banks. With fintech revolutionizing the domain of finance substantially, availing personal loans is almost just a click away!
However, while applying for a personal loan, a good credit score continues to hold major significance.
Depending upon the score an individual has, lenders approve the amount of loan that can be sanctioned. This holds true especially while availing personal loans. The Credit Information Bureau (India) Limited (CIBIL) states that chances of getting a loan sanctioned or even securing a credit card get higher by 79 per cent if one has a decent credit score.
Why credit score holds so much significance while applying for a personal loan? The reason can be attributed to the nature of the personal loan. A personal loan is essentially an unsecured loan for which lenders do not ask for collaterals.
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