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Flexi Loan

Flexi Personal Loan

Last Updated 07th Mar 2021

  • A Flexi personal loan is offered by banks and NBFCs whereby borrowers can avail the flexibility of withdrawing an amount of money as and when required.
  • The amount withdrawn during the loan tenure must be within the limit of the amount pre-approved by the lender.
  • Minimal documentation is required for disbursal of the loan such as ID proof, address proof, income proof, etc.
  • Interest on Flexi loans is applied only on the amount withdrawn from the pre-approved limit and can be repaid as EMIs.
  • One can apply for this loan online through the website of the lender for instant approval and quick disbursal of the loan amount.
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What is Flexi Loan & How it Works?

A Flexi loan is a type of personal loan that comes with a pre-approved loan limit from which any amount can be withdrawn as and when the requirement arises. With a Flexi Loan, you can withdraw the required amount as many times as you want, provided you stay within the credit limit. It, thus, enables the borrowers to get easy access to funds at a time of financial emergency.

For availing Flexi loan, you need to apply for the same by submitting the required details and documents to the chosen lender. On successful document verification, the amount approved by the lender is disbursed from which you can avail the fund needed to meet your financial requirement. In a Flexi loan, the interest is charged only on the amount withdrawn and not on the pre-approved loan amount. You can repay the loan in EMIs calculated on the withdrawn amount only. The loan can be closed before the tenure ends by prepaying the outstanding debt, in case you have extra funds. Thus, with Flexi loans, you can enjoy the flexibility in terms of cash withdrawal as well as loan repayment.

Flexi Loan Features

Most leading banks and NBFCs offer Flexi loans for the convenience of account holders. This type of loan has features that are in favour of the borrower. Here are the features of Flexi loan.

  • Lenders offer Flexi loans with a predetermined credit limit. You can borrow any amount as per requirement within the credit limit.
  • Interest payable at the time of repayment shall be applied only on the amount withdrawn and not on the amount offered by the lender in the first place.
  • Borrowers are allowed to prepay the loan amount in case they want to foreclose the loan with no foreclosure charges applied.

Flexi Loan Benefits

Flexi loan is not only easy to get due to the instant approval option but can also be repaid more conveniently than a standard personal loan. Some of the benefits of Flexi personal loan are mentioned below.

  • Easy access to funds: Flexi loans allow you to withdraw money as and when needed within the pre-approved limit, thus, helping you get easy access to funds in case of a financial crisis.
  • Flexible repayment: The Flexi loan makes repayment easier as you can borrow the amount that you can afford to repay. Moreover, when you have access to funds, you can pre-close the Flexi loan, meaning you can repay the entire borrowed amount before the end of loan tenure with zero foreclosure charge. In this way, you can save on the overall interest payment.
  • Multiple withdrawals: You can withdraw money under the Flexi loan any number of times within the prescribed credit limit. In case you face an urgent need for cash after prepaying the borrowed amount, you can withdraw the amount needed within the overdraft limit. Thus, you can save yourself from the hassle of applying for new loans as well.
  • Requires minimal documentation: Minimal documentation is required to avail the loan as it is pre-approved, which makes the process less time-consuming and hassle-free.
  • Lower interest rates: While repaying this loan, you need to pay interest only on the amount withdrawn and not on the amount sanctioned by your lender. It not only implies a lower interest payment but also reduces the EMIs to be paid.

Documents Required for Flexi Personal Loan

A Flexi personal loan requires minimum documentation. Nonetheless, here goes the list of required documents.

  • KYC documents such as Aadhar card , voter ID, passport, photograph, etc.
  • Latest salary slip or Form 16
  • Bank statements of the last six months
  • Certificate of business existence
  • Relevant business financial documents

Flexi Loan Eligibility Criteria

Both the salaried employees and self-employed individuals can apply for Flexi loan, meaning the Flexi personal loan. The eligibility criteria for getting this loan varies from one lender to another. However, some of the common eligibility criteria are listed below:

For salaried individuals

Salaried individuals are required to fulfill these criteria:

  • Must be a citizen of India
  • Must be of age between 25-55 years.
  • Must be a salaried employee of a public sector establishment or private company or an MNC.

For self-employed individuals

Self-employed are required to fulfill these criteria:

  • Must have a business establishment of at least three years.
  • The business must have fled for one income tax return at least for the past year.
  • Must be between 25 - 55 years old.
  • Must be a citizen of India.

How to Apply For Flexi Personal Loan?

All Indian residents, both salaried individuals and self-employed, can get Flexi hybrid loan if they meet certain eligibility criteria. To apply for a Flexi personal loan, follow these steps:

For salaried individuals

These steps can help salaried individuals while applying for a Flexi loan.

  • Visit the website of your chosen lender, fill the required details in the online form and submit.
  • Select your desired loan amount and tenure to get instant approval.
  • Submit the necessary documents either online(if the option is available) or to the representative of your lender when he gets in touch with you.
  • After successful document verification, the approved amount will be credited to your loan account. You can withdraw funds according to your needs and transfer it to your savings account within two hours.

For self-employed and businessmen

The steps to be followed by businessmen for applying for Flexi loans are mentioned below.

  • Go to the official website of your lender and get the Flexi loan application form.
  • Fill out the application form with the required details to be given and click on 'Submit'.
  • After submission, a representative of your lender will get in touch with you for collecting the required documents for verification. Some lenders verify the documents online.
  • Once the documents are done with verification, your loan amount will be credited to your loan account from which you can transfer the required money to your bank account.

Difference Between Term Loan & Hybrid Flexi Loan

The standard term loan differs from the Flexi hybrid loan. The distinction between the two is listed as follows:

Term Loan Flexi Hybrid Loan
Term loan is approved by lenders for lump sum use at once upon disbursal. The entire sanctioned amount is disbursed to the bank account on loan approval. In Flexi loan, only the amount needed can be withdrawn and is credited to your account. You must remain within the limit of the sanctioned loan amount.
Usually, term loans take time to get approved as it requires tedious documentation and verification process. You can get instant approval on Flexi loan with the disbursal of the desired amount within 24 hours in most cases. Most lenders also offer online approval and disbursal of loan.
In a term loan, interest is applicable to the entire sanctioned amount. In a Flexi loan, interest is applied only on the amount withdrawn by the borrower and not on the entire sanctioned amount.


How can you repay your personal loan amount?

The personal loan amount that you have borrowed can be repaid via monthly EMIs. If you have a Flexi personal loan, you just need to repay the amount withdrawn and not the amount sanctioned by the lender. You can also opt for a prepayment option whereby you can foreclose the loan by repaying the entire amount before the tenure ends. No pre-closure charges will be levied in that case.

What do you mean by personal loan Flexi EMI plan?

The Flexi EMI plan of a personal loan is an EMI option where borrowers can avail the flexibility in EMI payment for repaying their personal loan. Under this plan, you can pay a lower amount of EMI during the initial months of the loan tenure, which gets gradually increased later as your income becomes higher.

What should you opt for - Standard EMI plan or Flexi EMI plan?

Under the Standard EMI plan, you have to pay a pre-fixed EMI every month till the entire loan gets repaid. Flexi EMI plan, however, allows you to choose to pay a lower EMI initially and gradually start paying a higher EMI as your income increases. Thus, it is better to opt for Flexi EMI plan than Standard EMI plan as then you can repay the personal loan according to your availability of funds.

How can I withdraw money from Flexi Loan?

You can withdraw the required amount of money from your Flexi loan account any time you want. There is no limit on the number of times you can withdraw funds from the loan account. You have only to make sure that you withdraw an amount within the credit limit preset by your lender.

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