Personal Loan KYC: Easy Procedure to Complete KYC Online for a Personal Loan

A personal loan is an unsecured loan, meaning you do not need to give any asset or collateral to get it. Personal loans are applied for by individuals for medical expenses, maintaining a home, education, or other individual needs.

Because there is no security behind the loan, lenders verify your credit history, income, and repayment capability. A major component of this is KYC verification.

What is the meaning of the word KYC?

Know Your Customer (KYC) is a procedure that banks and financial institutions follow to verify your identity and address. It ensures that lending remains safe, legal, and transparent.

KYC can be done by furnishing documents such as your ID proof and address proof. This is necessary because it prevents fraud, identity theft, and money laundering.

Is KYC Necessary for Personal Loans?

Yes, KYC applies to all applications for personal loans. It assists lenders in the following ways:

• In verifying your identity and personal information.
  
• In reviewing your financial history and credit report.
  
• In ensuring you’re not applying using a third person’s identity.
  
• In reaching you in the event of repayment difficulties or fraud.
• In case KYC is not done as required, your loan may be delayed or rejected. Providing fake or incorrect documents is also likely to invite legal issues.

The process is straightforward: Fill in your personal information, do the KYC verification online and select your loan amount and EMI plan.
Interest rates can begin as low as 10.5% per year, based on your income and employment status.

What Documents Are Needed for KYC?

Whether online or offline, you will be required to upload the below-listed proofs:

1. Identity Proof (any one):

• Aadhaar card
  
• PAN card
  
• Passport
  
• Voter ID
  
• Driving license
  

2. Address Proof (any one):

• Aadhaar
  
• Passport
  
• Ration card
  
• Electricity bill
  
• Rent agreement
  

3. Income Proof:

• Salary slips
  
• Bank statements
  
• Income Tax Return (ITR)
  

How to complete the process of KYC for a Personal Loan?

Online KYC Process

• Open the official website of the lender or app.
  
• Enter your Aadhaar number.
  
• Complete authentication via OTP or biometrics.
  
• Some lenders may ask for Video KYC as well.
  
• Submit your details to verify and get instant approval.
  

Offline KYC Process

• Visit the nearest bank branch.
• Submit your KYC documents.
• Fill in the loan application form.
• The bank will verify your documents manually.
• Once verified, your loan will be processed.

KYC Methods for Moneycontrol Loans

a) Digilocker:

• Fill in your Aadhaar or mobile number.
  
• Verify using an OTP.
• If verified, your Digilocker profile is linked for KYC success.

b) Aadhaar OTP:

• Enter Aadhaar number and captcha.
• Receive and submit the OTP.
  
• If this does not work, upload the front and back images of Aadhaar.

c) Manually:

• If both of the above methods fail to work, upload scanned copies of your ID and proof.
  

What is the Importance of KYC?

KYC assists in the following:

• Accelerate the loan sanction process.
• Avoid fraud and scams.
• Secure your identity.
• Establish trust between you and the lender.

Without KYC, lenders may reject or hold up your application. So, ensure that you provide authentic and accurate documents for a hassle-free loan experience.