If you think an “Aadhar card loan” is a financial product similar to a credit card loan, you are highly mistaken. It is impossible to get a loan using your UIDAI-issued identity card, nor can you borrow money against your Aadhar card. So, phrases such as ‘loan on Aadhar card,’ ‘personal loan on Aadhar,’ and ‘Aadhar card loan’ are misleading and can create a lot of confusion.
So, here is a fact. There is no financial product as a loan on an Aadhar card. However, you can use this UIDAI (Unique Identification Authority of India) ID to get a loan along with other supporting documents outlined by your prospective lender. Let’s learn more!
What is an Aadhar Card Loan?
An Aadhar card loan is a type of personal loan that uses an Aadhar card as the primary KYC document to verify the borrower's identity and expedite the loan application process. When an Aadhar card is used as a paperless e-KYC document to get a personal loan, it is commonly referred to as an Aadhar card loan.
The Aadhar card fulfils your eligibility criteria for biometric verification. So, the overall process of getting a personal loan approval becomes much simpler and faster.
How to Get a Personal Loan on an Aadhar Card
When you apply for a personal loan, you have to submit a plethora of documents. But now, Aadhar card and digitalisation have made it much simpler to apply for a personal loan. Your Aadhar card is a single document that is KYC proof and is accepted by most banks and NBFCs as proof of identity, residence, citizenship, and birth.
To apply for a personal loan using an Aadhar card, all you have to do is fill out an online personal loan application and provide your Aadhar number. If your Aadhar card is linked to your PAN and your bank account, you don’t have to upload extra documents. You just have to provide proof of your address and income and give permission to the lender to carry out background checks based on your Aadhar card.
Once you clear the eligibility and verification checks, the personal loan will be approved, and the funds will be transferred to your account within a couple of days, or maybe sooner.
Note: According to a recent circular released by the RBI, an Aadhaar card cannot be used as address proof for financial accounts such as loans or deposits. This is the reason why you still will need to provide proof of valid address, such as an electricity bill, passport, driving license, rent agreement, etc. while applying for a personal loan.
Top Feature of Personal Loan on Aadhar Card
The following combination of features makes a loan on Aadhar card an attractive option for anyone in need of quick, hassle-free financial assistance.
Flexible Loan Amount
One of the standout features is the flexible loan amount, allowing you to borrow just what you need without overcommitting.
Efficient Eligibility Check
The quick eligibility check ensures that you can find out if you qualify in no time without the hassle of lengthy paperwork.
Collateral-free Loans
Another significant advantage is that these loans are collateral-free, meaning you don't have to pledge any assets to secure the funds.
Affordable Interest Rates
Moreover, the interest rates are pretty inexpensive, making repayment easier on your wallet.
Quick Disbursal Process
Lastly, the quick disbursal process ensures that you get the funds swiftly, often within a few hours or days.
Mandatory Documents Required for an Aadhar Card Loan
Proof of address: Passport/Driving License/ Ration Card/Electricity Bill/Rent Agreement
Cheques of your salary account
Passport-sized photos
PAN Card
Income Proof – Salary slips, Income Tax Returns & Bank Statement
Duly filled application form
Eligibility Criteria for Applying for an Aadhar Card Loan
You need to be a resident of India
You must be working with a public/private company or an MNC.
You must be between the ages of 23 and 57 years
The minimum salary requirements may vary depending on the lender and the city of residence
Benefits of Applying for a Personal Loan Using an Aadhar Card
This single document is considered proof for citizenship, address, photo, age, and identity.
Aadhaar card eases up the documentation process for both consumers and financial institutions.
In some cases, you don’t even need to provide a copy of your Aadhaar card – the 12-digit UID number is enough.
Aadhaar card helps with online verification process (e-KYC) and facilitates faster disbursal of loans.
The loan processing time is shorter, thus saving both time and effort.
Freo’s Personal Loan With Aadhar Card - Interest Rates & Charges
Interest rates on personal loan are subject to change and may vary based on the terms and conditions set by Freo. Here are the personal loan interest charges applicable to Freo’s personal loan on Aadhar card application online:
Need quick funds? Secure a personal loan of up to ₹ 5 Lakh swiftly using your Aadhar Card.
FAQs
Can I get a personal loan on Aadhaar card?
You can use your Aadhaar card to apply for a personal loan with any bank or NBFC. Since the Aadhaar card contains biometric data, it makes the verification process faster and simpler. Thus, your personal loan, once approved, can be disbursed quicker.
Can I get a loan on an Aadhaar card only?
While it's an essential document for obtaining an instant personal loan from Freo, you'll also need to provide proof of income.
Can I get Aadhaar card loan for ₹ 50,000 online?
Once you submit your online loan application using your Aadhaar card, your eligibility will be verified, and on the basis of it, the loan will be sanctioned.
My credit score is 600. Can I get an Aadhaar card loan?
Most lenders require the potential borrower to have a credit score of at least 750. However, some financial institutions can still approve your loan with a credit score of 600.
Is Aadhaar card loan an instalment loan?
Yes. Since loan repayments are made in monthly instalments, Aadhaar card loan can be considered as an instalment loan.
Is Aadhaar card a mandatory document to apply for a personal loan?
No. Although the Aadhaar card helps in speeding up the personal loan application and verification process, it is not a mandatory document. Instead of an Aadhaar card, you can use other documents such as your passport, driving license, etc. for KYC.
Is it possible to apply for a personal loan on Aadhaar Card without having a PAN card?
Yes. If you do not have a PAN card, you can still apply for a loan on Aadhaar card. However, you may be required to provide a few other documents, such as Voter ID card, passport, driving licence, salary slips, and so on. The document list can vary depending on the loan provider.
How long is the loan application process when you apply for a personal loan on the Aadhaar card?
Applying for a personal loan on Aadhaar is usually a quick process. This is because Aadhaar contains your biometric data, making the verification process, simpler and faster. If you have a good credit score and meet the eligibility criteria of the lender, you can apply for the loan online and get it disbursed within 2 to 3 days.
Do I need a co-applicant for a personal loan on Aadhaar card?
Generally, you do not need a co-applicant for a personal loan on Aadhaar card.
How much of a loan can I get on my Aadhaar card?
At Freo, we offer loans up to Rs.5 Lakh with minimal hassle. Simply meet our eligibility requirements and submit the necessary documents, including your Aadhaar card. It's that straightforward!
