Thursday, February 9, 2017

Why Should You Buy A personal Accident Policy Right Away?

Every day, as we go about our lives, we are susceptible to a number of risks. The probability of an accident increases significantly if your profession entails a lot of traveling.  In such a case, we may never know when a mishap or tragedy might occur. This gives rise to the need for a personal accident policy to safeguard you against accidents. Let’s see why a standalone personal accident policy has acquired importance nowadays.

Before we begin to discuss the importance and features of a personal accident policy, it is crucial to understand what an ‘accident’ is. To put it simply, an accident is any unfortunate or undesirable event that results in loss or injury. There are two types of financial losses that are incurred. First is the one that is caused due to medical expenses and the second is due to loss of income resulting from the inability to work.

Accident insurance

A personal accident insurance is a policy that offers coverage for loss during an accident. This cover has an advantage over a life insurance policy in the sense that it offers coverage from death as well as injuries. The injuries can be permanent or temporary subject to policy coverage. This makes the accident policy a very useful one. Accidental insurance plans generally cover permanent as well as temporary disabilities. For instance, if you get a burn or if your hand gets fractured in an accident, you can be assured that your accidental policy will cover you. Additionally, there are certain insurance companies that offer add-on coverage in case of certain scenarios.

Who should buy a personal accident cover?

-It is highly recommended for young drivers who you use a vehicle on a daily basis to work or college. If you use a two-wheeler it makes it all the more important to go for an accidental insurance.

-If you have availed a loan such as home, car or even a personal one for that matter. It makes sense to get a personal accident cover so that your family members are safeguarded against repayment of the pending loan amount.

-Accidental insurance is also advisable for professionals that work in high-risk environments such as a manufacturing unit or an offshore plant.

-People planning to include a rider to their existing life insurance cover: In such a scenario, it is recommended to go for a standalone personal accident cover since it offers more benefits and at a comparatively lesser premium.

An important advantage of the accidental cover is that it offers comprehensive coverage at good premium value. It is generally cheaper compared to life cover. In addition to that, you also get various discounts.  You get good discount offers when buying a personal accident insurance online. Also, most insurers offer a cumulative bonus if you haven’t made any claims during a certain time period. 

Lastly, before buying a personal accident cover it is important that you go through the policy document carefully. There are several exclusions to the cover that varies across companies. They include situations like an accident while engaging in adventure sports or under the influence of alcohol.

Thursday, January 26, 2017

3 Ways to Apply for a Credit Card

Credit cards make life easier when used responsibly. In the current financial situation, using these products appropriately may help to overcome cash crunches.

However, if you do not have a credit card, you may consider applying for one. Most financial institutions offer different types of cards to suit the unique requirements of users. First-time applicants may consider the following three ways to apply for a credit card

1.Online application

The Internet has made it quick and simple to access almost everything from the comfort of your home or office. You may visit the financial institutions' websites to understand the different credit cards that are offered by them. You may click on the ‘Apply Now’ button to start the online application process.

Credit Cards

2.Physical application

If you do not want to follow the online application process, you may opt for applying in-person. You may visit the nearest branch of the credit card service provider and complete the application process.

3.Telephonic application

In case you do not have the time to physically visit the branch, you may call the financial institution’s customer service number. Trained and experienced professionals will guide you through the entire process of how to apply for credit cards through a telephone call.

Here is the basic information you will have to provide while applying for a card:
  • Name and date of birth
  • Total income
  • Home address, email id, and contact number
  • Details of current and past employments
  • Particulars of any other credit cards you have
Three steps to apply for a credit card:

1.Fill out the application form

Firstly, you need to fill out an application form provided by the financial institution. Generally, the form is simple and takes a few minutes to complete. You may also take the help of a company representative to fill out the credit card application form. If you choose to avail of the card from your current banker, you may not have to submit the documents as the bank already possesses your information.

2.Answer the verification call

When your application form is sent for approval, you will receive a verification call. The call is primarily made to verify the information provided by you at the time of your application. You may also have to visit the branch within a few days for the same. It is advisable to be available for the confirmation and verification as any late response may delay you procuring the credit card.

3.Verify the card with your signature

Once you receive your new credit card, it is important that you verify it with your signature. Any oversight to this may result in severe results in the future.

Having a credit card provides you with a certain level of financial freedom. You are able to make purchases up to the available limit on your credit card without having the cash. However, many credit card users fall in huge debt traps by using their cards irresponsibly. You must be careful while using the credit card so as to ensure you do not face financial difficulties in paying the credit card bills on time.

Thursday, January 19, 2017

Five Non-Core Functions You Should Outsource Now

Every business, no matter how big or small, has some functions that are not the main function of the company. Employing people in-house to perform these tasks can be expensive and might cause the company to be less profitable than it could be.

If this is the case, you might consider outsourcing some of the non-core functions to an overseas virtual office assistant or payroll department that speaks excellent English and has a strong work-ethic. 

Before you do this, you need to identify areas that are not the essential aspects of your business. Read this helpful guide in order to find out more.

Personal Assistance

A personal assistant can help you to arrange meetings and to take notes. This is something that can be delegated to a virtual assistant in the Philippines, which will be just as efficient and will cost the business much less. The standard of English in the Philippines is excellent, due to the fact that schools there follow an American curriculum and they are quick learners. This will ensure that there are no misunderstandings or breakdowns in communication.

business ideas

You will be able to get on with your day as normal, whilst being able to keep in contact with the personal assistant through a variety of communication channels.

When you are choosing an assistant, remember that it is a very good idea to shop around. Compare several different companies which offer this service. 

Data Entry

Data entry can be a time-consuming task for your employees when they could be doing other more vital tasks. This is one of the most common tasks to outsource abroad to a company that specialises in data entry. You will be able to leave this in their capable hands whilst your employees can focus on other areas of the business. There are many companies who will be able to provide fast and accurate data entry, whatever format the data entry takes.


Bookkeeping involves keeping track of all the company income and expenditure in order to work out how much profit the business is actually making. This is a relatively straightforward process for someone with a head for numbers and scrupulous attention to detail. Instead of employing someone in-house to do this, why not save some money by using a third-party company?


The payroll department of a company is responsible for making sure that everyone is paid on time and with the correct amount. Calculations also need to be made when it comes to pension and income tax deductions. This can be handled by business process outsourcing, allowing you to spend the money that is saved in other areas of the business.


Manufacturing costs can be lowered if you choose to have goods made overseas.

Use this guide to understand the non-core functions of a business that can be delegated.

Friday, January 6, 2017

Ways to Trick Yourself into Saving Money

Have you ever thought that most of your money you have is being wasted as you don’t have a proper saving habit? Think of it this way, you can almost double your earnings if you just try and be careful about your saving habits. You can use all this extra money for paying off all the debts which are pending, assimilate them for your future emergencies or even splash it on yourself and have a bit of fun.

The choice is yours, but the fact is you can save a lot of money if you try and be a bit cautious and aware. As they say “Money saved is money earned”.

Here are some of the simple tricks which might help you to handle your personal finances: -

#1 - Have your own budget planned

Creating your own budget is the very beginning of taking control of your wealth. It will act as a storekeeper and have an account for all the money that is coming in or going out of your wallet.

Saving Money

For the initial few days just keep a track of all your expenses. You don’t have to restrain from spending rather just keep an account of all the money that you spend in a given interval. To aid to this save all the receipts which you have, keep a control of all the cash you spend and also the credit card bills which are done.

The main goal is identify how much money you have spent and how much money is left in your account at the end of certain period. Now based on the knowledge about your spending draw a budget about how much money you require for all your expenses. This would help you to limit your wasteful spending. In your budget, create provisions of actual budget and forecasted budget so that you keep a track of the fact where you went wrong.

#2 - Spend less

You should always try and spend in a very responsible and mature manner. You should spend only on those items which are essential for you and try to prevent wastage of money.

For many of us buying a home is the most costly and significant payment which we will ever make in our lives. You need to plan for spending like this carefully. Try and pay the mortgage as much as possible at the earliest which would be helpful in preventing any sort of interest.

The main aim should be to minimize the interest payments and at the same time balance the rest of the spending on your budget. Use your credit card carefully as having a credit score of more than 750 will help in availing very low interest rates and cheaper loan options.

#3 - Invest Carefully

You need to be aware about all your investments as the financial world is much more complicated that you expected it to be. Try and be familiar with different types of investment options which are present in the market.

In the stock market fortunes are made or lost every day. The more you are aware about this financial market the better you will be able to invest all your hard-earned money. The most important part of that awareness would be to know when to back away and when to put your foot down and go ahead.

If you decide to invest in the stock market then always put money on safe stocks, don't try to gamble with it. Most of the novices who try their luck in stock market try to make small gains by spending on day stocks which is very poor choice. While it can provide you with some quick cash the risk associated with it is extremely high and it is more akin to gambling than investing.

If you desperately want to invest in stock market then the safe investment would be in the long term stocks. This means that you have to leave your money invested for more than 5 years. So you need to be very cautious while investing.

#4 - Build Your Savings

An important part of financial management would be to start an emergency fund for your times of need. To have a large expendable income would mean that you do not have many debts. By not having any sort of debts will help you a lot in fighting all sorts of emergencies.

When you have decided to save for retirement and emergency fund then always save for more than a couple of months. If you lose your job or face any medical emergency than some large amount would be required to bail you out when disaster strikes.

Saving your money is an essential part of your life as this will help you in achieving all your goals of the future. So, you always need to be careful while dealing with your finances in your everyday life. It may feel a bit overwhelming at times when you realize that you are struggling financially but a little patience and hard work can help you achieve all your goals.

About the writer: Tina Roth is a freelance writer and personal finance blogger. On her personal finance blog, she writes about personal finance, frugal Living, ways to save money and money management strategies. She is a contributor for a variety of financial publications online too. Reach here @ProFz`inanceBlog.

Thursday, December 29, 2016

What if you missed paying your life insurance premium?

Life insurance policies can be a complicated affair if not downright unintelligible. A good analogy to understand term insurance is through the analogy of buying vs. renting. With term life insurance, the insurance is never really yours. Term life insurance is an autonomous contract between the life insurance company and you. It means the obligation rests only on one party and that is the life insurance company. Just like how an auto insurance offers you coverage till you pay the premiums and the policy lapses when you don’t pay, term life insurance too offer coverage only until you pay the premiums.

life insurance

At Policy Bazaar, we are often asked if lapse of life term insurance policy may hurt the credit of our customers. The answer is a resounding no. Life term insurance is a unilateral agreement and so there are no obligations on the customer’s part to pay the premiums. Contrary to credit cards or bank loans, missed payments are not reported to credit bureaus or consumer reporting agencies.

When you don’t pay your premiums, your term policy lapses. But what happens when you miss a payment date? Does this mean your policy lapses? Well, missed payments doesn’t need to be a reason to panic. Life insurance companies offer some options to counteract missed payments.

The Grace Period

All term life insurance offers you some kind of grace period (ranging from 15 to 30 days. In some cases, it could go even up.) The policy won’t lapse if your life insurance company receives the payment within the grace period. It is also important to note that even during your grace period you will be covered with life insurance and in case of unfortunate event like your death, the company is still bound to pay the death benefit. However, each company has their own guidelines when it comes to life insurance policy and you need to be aware of the specific rules regarding the grace period.


The next question is what happens when you go past the grace period without payment of your premium? If you still want the term coverage, you have the option to apply for reinstatement. As stated earlier, every company has their own guidelines for reinstatement however, most companies will allow to apply for reinstatement up to even five years from your grace period. So how can you apply for reinstatement?

Fill a Reinstatement Application – Just like how you filled the original application for the application of the policy, you would need to fill a reinstatement application.

Health Statement – You may also be asked to provide a health statement about your current health status to see if something has changed since your original application.

New Paramedical Exam – You may have to give paramedical exam depending on the requirement of a life insurance company. In general, most of the companies don’t require a paramedical examination if the application is received within 90 days from grace period. However, if you had a change in health status regardless of the time period from grace period, your life insurance company will most likely require a paramedical examination. 

You need to note that once your reinstatement gets approved, you will need to pay all the premiums from the end of grace period which could be significant amount if it has been several months or years since the lapse of the policy. If the amount is significantly high, it may be a better choice to apply for a completely new policy.

Cancel the Policy

If you decide to terminate the life insurance policy because you found a less expensive policy or because the old policy’s reinstatement amount is significantly higher, you have couple of options to terminate the policy.

Stop Paying – This is the simplest way to cancel the life insurance policy. You just need to stop paying the premiums and the policy will lapse. However, in case you pay your premiums once or twice a year, it may mean leaving good money on the table for which you can formally cancel the policy.

Formally Cancel – you can formally cancel the policy by calling the life insurance company and asking them to cancel the policy. Provide them a specific date and they may refund all ‘unused’ premiums that you have paid.

The best thing that can be done in case you lag behind in the premium payment is to contact them, ask their opinions and then make an informed decision.

Monday, December 19, 2016

6 Steps to Choosing the Right CCTV System for your Home

If you want to beef up your home security, and you've decided that CCTV is the most cost-effective option, you still have to select the system and the installation company. There are many systems available, and if this might seem a little daunting, here are some things to look out for when choosing a video surveillance system.

1. Ask the Experts

Of course, the best people to ask are those who fit security systems for a living, and if you happen to live in Western Australia, and are looking for CCTV in Perth, you couldn't find a better supplier than, who have a wide range of video surveillance systems for both commercial and residential properties.

Choosing the Right CCTV

2. Discretion or Visibility

You must decide if you want the CCTV system to be easily seen or hidden from view, and for a homeowner, it would be wiser to have the cameras installed in prominent locations. This will act as a deterrent to house breakers, who know all too well that the evidence is admissible in a court of law, and would therefore avoid any property with CCTV cameras installed.

3. Harsh Environments

If the cameras are to be installed outside, and the weather can be extreme, it is important to select a strong housing and the right type of camera. In commercial environments, the cameras might need protection against grease or sawdust, and an established CCTV systems supplier would be able to recommend the ideal model.

4. Image Clarity and Detail

If you require a high level of clarity, it would be wise to opt for a higher megapixel rating, and some cameras are better suited to low light environments. Your local supplier would be the best person to ask for advice about the right camera resolution.

5. How Many Cameras to Have

This depends, of course, on the size of the area you wish to cover, and with some larger properties, as many as 8 cameras would be used to cover every elevation and angle. For a typical home, you would not need any more than 4 units, which could be strategically placed around the perimeter to give you a complete view of the surrounding area.

6. Which Company to Choose

There are many businesses that supply commercial and domestic security systems, and it is wise to choose someone local, as they can easily respond to a service call. The Internet can provide the contact details of a reputable company in your area, and the company would be more than happy to send a representative round to assess your security needs. They would be able to offer several options, and depending on your budget, would be able to install the right system at an affordable price.

CCTV has always been a cost-effective way to protect a property, and with eyes and ears always on the lookout, you can rest assured your home is in safe hands. The deterrent value makes video surveillance a much preferred alternative to traditional alarm systems, and your home will always be monitored, day and night.

Fund Manager and Services for NPS Account

The National Pension System (NPS) regulated by the Pension Fund Regulatory and Development Authority (PFRDA) is a defined contribution retirement plan. All Government employees joining after 1st January 2004 except armed forces must compulsorily invest in this scheme.

From 1st May 2009, NPS was made available to the private sector through the All Citizen Model. However, the plan did not gain popularity because of two primary reasons. Firstly, the working of the NPS was complex and therefore, most investors failed to understand how it worked. Secondly, the designated Point of Presence (POP) did not promote this scheme because it offered very low earning to them. The POPs were offered INR 20 per investor irrespective of the amount invested.


The contributions made to the NPS may be invested in equities, government securities, or corporate bonds. The PFRDA has appointed fund managers who offer these services to the subscribers. Investors may actively participate in asset allocation or opt for the auto investment mode where the fund manager makes investment decisions. Until recently, the fund managers received only INR 9 per INR 10 lacs being managed by them, which was why they were not forthcoming in offering superior services.

NPS fund managers

The regulator has appointed 3 fund managers namely LIC Pension, UTI Retirement Solutions, and SBI Pension for the Tier I government subscribers. Private sector personnel may choose among ICICI Prudential, SBI, DSP Blackrock, UTI, Reliance Capital, and Kotak Mahindra.

Tier II account holders may choose to avail services from six fund managers. These include ICICI Prudential Pension, UTI Retirement Solutions, DSP Blackrock, SBI Pension Funds, Reliance Capital Pension, and Kotak Mahindra Pension.

Government fund managers earn 0.0102% management fees while private sector service providers charge 0.25% fees. The management fees are similar for Tier I and Tier II accounts.

Investors must choose one of these fund managers at the time of opening the NPS account. They may determine their PRAN number status in case it has not been received. Permanent Retirement Account Number (PRAN) is unique and offers portability to the NPS account holders.

Asset classes and fund managers

The subscribers may invest the contributions in 3 asset classes; equity (E), government bonds (G), and debt instruments (C). The maximum allocation for E is limited to 50% of the invested amount. Investors who do not actively participate in the asset allocation may choose the auto mode. The funds under auto mode are invested in a Life Cycle Fund, which combines the 3 asset classes. Under this investment mode, the exposure to equities is reduced as the subscribers get older and near the retirement age.

Proposed modifications

The NPS is the lowest cost investment product available for retirement planning. The POPs initially received a maximum fee of INR 20 per subscriber. This was very low and deterred them from promoting the scheme even with the NPS tax benefit. 

The PFRDA has revised the fee offered to the non-government fund managers from 0.0009% to 0.25% of assets under management to ensure it is profitable for them. In addition, the fees payable to the POPs are now increased to INR 100 plus 0.25% of the investment amount. These modifications are expected to encourage POPs and fund managers to actively promote NPS.

Investments up to INR 1.5 lacs are deductible under section 80CCD (1) of the Income Tax Act. An additional INR 50,000 may be used as an NPS deduction under section 80CCD (1B). The higher tax benefits under the NPS may increase the number of subscribers from the private sector.

Retirement planning is important and NPS is made available as an alternative to the 401(K) plan available for the American employees. Unfortunately, a large number of Indians still do not plan for their retirement. Retirement planning is important to ensure individuals are able to sustain their present lifestyles even after retirement. Using a pension plan calculator to determine the amount they would get during the post-retirement years will be beneficial.

Sunday, December 18, 2016

Is Low CIBIL Score a Dead-end for Home Loan Applicants?

Low CIBIL score seems like the end of the world for many home loan applicants. However, availing a loan is not that difficult despite a low score. 

Many individuals have a credit score of 0 or -1, which means their credit report says NA/NH. Due to this, such applicants face issues as many lenders steer clear from approving their loans because of no credit history. For banks, approving these loans is like gambling - there are 50-50 chances of repayments. Such individuals can simply get a credit card and make payments on time to build a good credit history. 

Home Loan Applicants

Individuals who have an ongoing credit history with a low CIBIL score can also get home loans, although through different routes. Let’s find out.

Leverage your monthly income

If you have a steady and growing monthly income with bank statements for proof, you can apply for a personal loan from banks or other financial institutions. 

Assistance from family and friends

You can turn to your friends and family to help you overcome this financial situation. Your family members and friends can help you in different ways such as:
  • Joint loan applicant: If the credit score of your family member or friend is good enough to apply for a home loan, you can go for a joint loan, i.e. become a co-signer. It will boost your chances of getting your home loan approved even without a good CIBIL score. 
  • Guarantor: You can ask your family member/friend with a good CIBIL score to become a guarantor for your loan. In this case, the lender will only consider the guarantor’s score and not your. 
  • Direct Loan: Your friends and family can lend you money to fund your big purchase. If they want, they can even charge you an interest rate a bank would. 
The things you must consider with this option is that a guarantor and a co- applicant will be held liable the same way you are. Ensure that there are no default or delayed payments on your part. 

Collateral Loans

If you have no other means, you can go for loans against assets, which are offered by lenders even if you have a bad credit history. The assets that you can loan against include gold, Insurance Policy, FDs, PPF account, etc. The amount you get against assets is solely based on the value of the assets.

4 Recent Trends in the Indian Home Loan Sector

Purchasing a new home may be a difficult task. There are many aspects to be taken into consideration while buying a house, the main factor being finance. As the cost of real estate is high, it often becomes difficult to buy a house with accumulated savings. However, with a large number of home loan financiers in the market today, owning a home has now become an achievable dream.

Home Loan

The home loan market has come a long way from what it was to what it is today. Following are the four recent emerging trends in the Indian home loan industry.

1.Greater competition

The last few years have witnessed a surge in the number of home loan borrowers. Sensing an opportunity, there has been a rapid increase in the number of home loan lenders. Due to this, the competition has increased manifold. Thus, lenders now offer numerous schemes to expand their customer base. Therefore, if you intend to buy property in India, you may now gain access to more prompt and flexible services.

2.Technology-driven services

With advancement in technology, home loan services are not as cumbersome as they used to be. Earlier, borrowers would have to visit the branch to obtain information about loan required to buy a property. Nowadays, online portals have made it easier to find out loan-related information, calculate monthly repayment amount, and check loan eligibility. Besides, you may also apply for a loan online and view your repayment schedule through the lender’s website.

3.Reduced interest rates

While the interest rates for home loans were high in the past, today these rates have dropped substantially. In 2015, the average interest rate of home loans was about 9.94% in comparison to higher interest rates charged after the year 2008.The Reserve Bank of India (RBI) cut its repo rate by 25 basis points at the beginning of 2015. Repo rate is the rate at which RBI lends money to financial institutions. With the cut in this rate, lenders are expected to lower their rates of interest on home loans. This is certainly beneficial if you are seeking to buy a property in India.

4.Rise in borrowers from small cities

While the top 10 cities in India have been largely contributing towards India’s home loan market, the borrowing patterns of smaller cities and towns, including Tier-2 and Tier-3 cities, have also gained momentum.  Major Public Sector Undertakings (PSUs) and some leading private banks have noted a strong demand for home loans from smaller cities. This is due to the affordability, connectivity, and increasing employment opportunities.

The Prime Minister of India, Mr. Narendra Modi, has the vision to provide housing for all by the year 2022. Moreover, the demand for housing units in India will continue to witness an increase due to rising income levels, lower home loan interest rates, increasing urbanization, and easier capital regulations for loans. With the easy availability of loans and numerous other benefits offered by lenders, you may conveniently purchase a property in India.

Saturday, November 26, 2016

Opt for Personal Loan to Go for Your Dream Holiday Vacation

Taking a vacation is no longer an impossible dream. This is because individuals may avail of personal loans to take their dream holiday. Firstly, these loans are easily available and do not require providing collateral. Most people aged between 21 and 58 years with a minimum income of INR 25,000 are eligible to avail of this loan. Furthermore, individuals only need to submit basic documents, such as income and address proofs, and bank account details to acquire this loan. Being approved for personal loans is not difficult for most applicants because of the simpler qualification and eligibility norms. Moreover, opting for a personal loan to take a dream vacation has several benefits.

Advantages of Personal Loans

1.Faster Processing

It is not uncommon for people to plan vacations within a short period. Several individuals simply want to get away from the hectic life of urban cities. Often, they are unable to fulfill their dreams due to lack of adequate funds. They no longer need to be disappointed because personal loans are available quickly as the processing time for such loans is lower than other types of loans.

Dream Holiday


These types of loans are available for vacations both in India and in a foreign country. Individuals may acquire between INR 50,000 up to INR 15 lakh to take their dream holidays. Furthermore, repayment is also not tough because the loan tenure ranges between one year and five years. The equated monthly installments (EMIs) are fixed during the entire duration thereby enabling people to plan their budget in such a way that they do not face financial difficulties while servicing the loan.

Factors to Consider While Applying for a Personal Loan

Using a personal loan to take a dream holiday is tempting. However, individuals must be aware of the dos and don’ts while opting for these funds. Here are four factors to consider before signing on the dotted line.

1.Set a budget

This is one of the most important things a person must remember while applying for a personal loan. Failing to set a budget may result in over-borrowing, which may cause severe stress while repaying the loan. Although, individuals may have higher personal loan eligibility, they must avoid being tempted to avail of more money for their vacation. Opting for a bigger amount is not advisable if their income does not support the loan repayment.

2.Check the Rate of Interest

Generally, personal loans are more expensive when compared to other types of funding options. Knowing the interest rates beforehand will help an individual calculate the approximate monthly outflow towards loan servicing. Some institutions may provide additional offers that may be exciting. However, individuals must read the fine print to ensure these are not costlier than regular loans.

3.Select Flexible Repayment Schedule

Opting for a lender that offers flexible repayment schedule would be beneficial in the longer duration. This allows borrowers to repay the loan amount without any liquidity crunches. Individuals are also advised to avoid extending the loan tenure because it may result in higher interest payments. Furthermore, it may also affect their credit score making it expensive to avail of loans in the future. Choosing a lender that allows borrowers to reduce the loan tenure (that helps lower the interest payout) is beneficial.

4.Conduct Extensive Research

Borrowers must understand all the terms and conditions before opting for a personal loan. Comparing offers from different banks and financial institutions will enable them to make an appropriate decision. Reading the documents carefully and understanding clauses, such as a pre-payment penalty, failing to pay an EMI, and other terms are very important. Users are advised to conduct a research on the different product offerings from various institutions to ensure they make a well-informed decision.