If you commute to work every day or you often need to travel short distances for a variety of reasons, then you are well aware of the fact that two-wheelers are by far one of the most economical both in terms of money as well as time. But one common thought, which ponders all of our minds is whether we should get a two-wheeler loan to finance our dreams of having a bike as it comes to a variety of downsides.
But lucky for us, getting a two-wheeler loan is not the only option available these days to purchase your dream bike, and in fact, a better option is to get a personal loan, and in today's article, we will discuss exactly how.
What Is a Personal Loan?
One of the first and most important aspects we need to take a note of is the meaning of a personal loan. In simple terms, a personal loan is a financing instrument through which you can borrow a certain amount of money usually in the range of ₹10,000 to ₹25,00,000, and repay it back via easy repayment plans while enjoying low rates of interest.
While the concept of a personal loan is not entirely new in India, it has gained a significant amount of traction in the past couple of years mainly due to the wide avenue of options and opportunities it offers. The reason behind this is simple; when you take a traditional loan, you need to inform the lender of the purpose of taking the loan, that is where you will spend the loan amount.
On the other hand, in case of a personal loan, you do not need to inform the lender of the purpose of the loan, and thus you are free to use the loan amount as you feel best.
Difference Between a Personal Loan and Two-Wheeler Loan
Now that you know what a personal loan is, let us better understand the difference between a two-wheeler loan and a personal loan, across a variety of different factors.
If you have researched about two-wheeler loans in the past, you are well aware of the fact that most two-wheeler loans in India offer upto 80 to 85% of the current on-road price of the vehicle. This means that you will only get access to a certain percentage of the cost and you have to pay the rest from your pocket as down payment to the dealer.
On the other hand, a personal loan offers you the full amount you apply for. Which means that if the total cost of your vehicle is ₹80,000 you can apply for a personal loan, and you will get the full amount in your bank account instantly.
Thus you do not need to spend any extra from your pocket and avail the entire amount from the loan.
Most two-wheeler loans in India start at an interest rate of 10% and can go upto 25% depending on the make and model of your vehicle. This indicates that you have to spend a significant amount of money in the long run as interest charges and whether you realise it or not, this is going to be a financial burden.
On the other hand, when you take a personal loan, the interest rates are one of the lowest in the market, starting at 0.9% from banks.
Not only does a lower rate of interest help you save more money in the long run, but it also reduces your financial stress by a great deal.
If you have planned to take a traditional loan anytime in the past, you are well aware of the fact that they are infamous for their long disbursal times, and that is one of the main reasons as to why most people are wary of taking traditional loans. Not only do you have to wait for long periods of time to get the loan amount in your bank account but also wait for elongated periods of time to get your application assessed and approved. All these reasons and much more contribute to traditional loans being unpopular among the public.
On the other hand, most personal loans come with instant approval and disbursement. Since most lenders have completely online application processes, you can upload all the documents onto the lender's website, and in a matter of hours, the automated algorithm will cross-check and verify your application. Post-approval, you can get the money in your account in 24 hours or less.
The instant disbursal process not only saves you crucial time, but it also ensures that you get the money in your bank account when you need it the most and not at a later time.
Online Application Process
Last but not least, most personal loans these days arrive with a completely online application process, meaning that you can fill the entire application and get the money delivered to your account right from the comfort of your home.
On the other hand, with a two-wheeler loan, chances are that you will have to visit the dealer multiple times to get your application filled and also follow up for the loan amount being dispersed to your account.
From the above-stated reasons, it is quite clear as to why you should get a personal loan to finance your two-wheeler, instead of taking a standard two-wheeler loan. To summarise, with a personal loan, you will get:
The full amount required to purchase your bike
Pay a lower rate of interest
Enjoy the benefit of instant approval and disbursal, and
Pay it back with a flexible repayment plan
So go ahead and apply for a personal loan to purchase your dream bike today.
Author Bio: Surya Patra is a qualified webmaster by profession and Marathon Runner/Cyclist by passion with more than 6+ years of expertise in the financial domain. Surya is also an entrepreneur, enthusiastic in storytelling, content writing, and digital marketing professional.