Aug 04 • 2 mins read
Is It Possible To Get A Loan Approved And Not Pay Interest?
Is it possible to get a loan approved and not pay interest? The short and rather obvious answer is no. Financial institutions rely highly on the interests accrued. Hence, they start charging interest the moment you take a loan from them. However, MoneyTap does give you a little respite. Using MoneyTap, you can have a loan approved and not pay interest until you really start using the money.
Let us illustrate the difference between a regular loan and a MoneyTap loan by taking the example of two young men – Saurabh* and Santosh*. After working for two years at a software company, they both decide to do MBA. Both get admission into a prestigious institute but the fees of the course are high. Santosh decides to take a loan from his bank. He goes to the bank and submits all the papers required to apply for the loan. In a week’s time, a bank does background verification, credit score check approves his loan and starts charging him interest. A month later, he pays his course fees. During the entire duration of the course, the bank charges him interest, but he is expected to start making repayments only after his course is complete. So, the interest is accumulated during the years of his study and can be paid only later.
Saurabh, on the other hand, applies on MoneyTap. With its 4-minute approvals, he gets his loan approved within minutes of registration. After a month, he transfers the amount required to pay the course fees to his account. He then pays the course fees. It is important to note that Saurabh is charged interest only after he actually uses the money to pay his fees (and not from the moment his loan is approved).
While studying for his MBA, Saurabh uses his salary from a part-time job to make partial payments on his loan. So, by the time Saurabh completes his MBA, he can clear his MoneyTap loan and be completely debt-free.
|Process||Loan From Bank||Loan from Money Tap|
|Paperwork required for approval||Yes||No|
|Days required to approve loan||> 1 Week||< 5 mins|
|Interest charged from||Day 1||Only when you use the amount|
|Interest charged for||Entire loan amount||Only for the amount used|
As you can see in the table above, no one can avoid paying interest on a loan. However, with the MoneyTap app, you can still enjoy an interest-free period after the loan is approved until the time you decide to use the money and transfer it to your bank account. In addition, you are charged interest only for the amount you transfer/use, as opposed to the entire approved amount, as done by other financial institutions. So, apply now and get the MoneyTap advantage.
(* – denotes imaginary names)