#aidigitallending

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You can learn about the challenges and solutions faced in raising financial inclusion in India by reading this blog. From AI digital lending to introducing video KYC,a lot of options have been discussed here.

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You need to check these factors before borrowing from digital lenders

People have started to prefer borrowing loans from AI digital lending platforms. The process is completely online and remote. Moreover, these digital platforms also have a simplified and faster credit underwriting process where even people with no prior credit history can apply for loans. Still, there the borrower must do proper research as well as check various factors before applying for a loan at these AI digital lending platforms. Go through the points that we have discussed below.

Points to check before borrowing from digital platforms:

 Ensure credibility:

You must check the credibility of the AI digital lending platform before applying for a loan.  If you are looking for credit on a mobile platform, select only those applications that follow the rules and guidelines of the respective app store. Even on the web, the digital lender must be registered under the Reserve Bank of India or as a verified lending partner of a legal bank. You can also research them online, and get feedback about their loan details and policies from previous or current customers. Borrowing from legal platforms will prevent you from falling into any types of financial loopholes or debt traps.

 Select the appropriate loan

Various types of loans can be available under a digital lender. As a borrower, it is your responsibility to learn about the different loans in detail and choose one that suits your needs the best. The credit risk management done by the digital lenders may require you to provide additional information depending on the type of loan. Here are some loan details that you must check beforehand:

The term period of the loan.

Do you need to provide any collateral?

The different types payment choices accepted for EMIs.

The loan approval and disbursement time.

 Go through the interest rates carefully

The interest rates provided by the digital lender depend upon the type of loan, its term period, the credit score of the borrower and other financial information. If the loan applicant has a high credit score, they receive lower interest rates compared to those who have poorer credit scores. Moreover, the interest rates can also vary depending upon the loan the borrower takes out. As the borrower you must know all the details before you apply for a loan. You can even ask about your queries when the platform conducts a credit risk management to check your creditworthiness.

 Understand the loan details properly

Although one can quickly get an online loan due to the boom in digital lending in India, they should properly read the details, rules, and clauses mentioned in the loan document. Most digital lending platforms appoint a loan executive when an interested applicant reaches out to them for a loan. The dedicated personnel clarifies all the points of the loan agreement to the borrower. After learning the complete information from the loan executive, the borrower can then decide to apply for the loan or not.

 Check the customer support service

As you are applying for a loan online from digital lenders, then you need to check the  quality of their customer support service before borrowing from them. There should be a proper support staff and service mechanism available to the borrowing customers. The customer service can send alerts and reminders to the borrowers before the due date of their loan payment arrives. Moreover, the loan applicant can also call the customer support service if they have any queries. To promote digital lending in India, having a robust customer support service for the digital lending platforms is necessary.

Having appropriate knowledge about these factors becomes crucial for a borrower when they are choosing an AI digital lending platform to apply for a loan. These checkpoints help them to choose a credible digital lending institution.

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This blog acts as a guide that informs you more details about your credit score. Read it before you apply for loans at a bank or AI digital lending platform.

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There are many AI digital lending platforms available nowadays. Before you apply for a digital loan from them, go through some of the points that you need to consider.They have discussed here.

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Go through the information given if you want to know how important credit scores are for the credit underwriting process at banks and AI digital lending platforms.