Personal loans are fast becoming the go-to financing option for many millennials. It is easy to procure, requires almost minimum documentation, and is unsecured (does not require any collateral to be put up). All this has enabled people to meet their financial needs with almost zero fuss and problems, all while helping them ensure regular cashflow at difficult times.

However, there is still a lot of debate around the disbursal of the Personal Loan.
In this article we will try and clear the air surrounding disbursal of Personal Loans.

Processing of Personal Loan Application

Your Personal Loan application is processed usually within 24 hours to a week, depending on the credibility of the information provided by you. Once it is approved, banks generally provide a cheque that you can collect from the branch, or sometimes, it’s mailed to your address.

Disbursal of Personal Loan

Once the Bank is satisfied with the information provided by you, it will approve your Personal Loan and the disbursement of the loan can begin.

The amount disbursed depends upon the loan agreement and other factors like :
  • Type of loan
  • Processing fee
  • Upfront payments (if any)
  • Service tax

Mode of Disbursal

In normal circumstances, a personal loan is disbursed within 24 hours of the application being approved. A cheque or a demand draft is provided by the bank, which is then either couriered or can be physically collected from the branch by you.

In rare circumstances, the loan amount can also be credited to your bank account by the concerned branch via a NEFT transfer.

Confirmation from the bank

After disbursal of the Personal Loan, the bank will send a confirmation letter either through an email or as a paper copy along with a welcome kit. Additionally, the bank will also provide you an EMI calendar and an amortization table that will help you calculate the principal to interest ratio for your loan payments.

Process of repayment

Once you’ve received the money, you can start repaying the loan in accordance to the agreement between you and your bank.You can repay the loan either through post-dated cheques or Electronic Clearing Services (ECS). If you’ve taken the loan from a bank you have an account with, you can opt for periodic auto-debt with standing instructions that will make the repayment process more convenient. However, if you’ve taken the loan from another bank, they will accept the repayment only through your salary account.

Learn more about your Personal Loan Eligibility here


The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.

Trending Articles

Article Links

How to Apply for a Personal Loan

Personal Loan EMI

Personal Loan Eligibility

Personal Loan Processing Fee

What is a Personal Loan

Latest Articles


Facing a Medical Emergency? 4 Reasons Personal Loan May Be the Right Choice

Read More
Posted on 07 February 2020

How to Qualify for a Personal Loan?

Read More
Posted on 05 February 2020

How to Track your Personal Loan Status?

Read More
Posted on 05 February 2020