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  • Personal Loan BYTES FROM OUR KITCHEN

    Loans for People on Benefits

    Who are ‘people on benefits’?

    The concept of ‘people on benefits’ originates from Europe and the United Kingdom is considered the pioneer in it. United Kingdom is a welfare state which aims to provide a decent standard of living to all its citizens. The concept of a welfare state is over a hundred years old and it was designed to provide support and benefits to the downtrodden so that they could live a decent life.

    Most European nations offer some sort of benefits to their citizens, varying according to governmental policies and budget criteria. The people who survive solely on the basis of such benefits are referred to as ‘people on benefits’. Governments across the world spend billions of dollars on providing benefits to the disadvantaged and there are millions of people who avail such benefits worldwide. Almost 30 million people have claimed benefits of one kind or the other in the United Kingdom alone, which is about 64% of the total families in UK.

    The United States of America also has a similar concept under its Social Security Scheme, which aims to provide certain basic services for free to its citizens.

    What are the benefits offered?

    Each nation has a set of benefits offered to its citizens and residents. Some of the major benefits offered across the world are mentioned here.

    • Health Benefit – Residents of UK and most European nations are offered health benefits from the time they step foot in the country. These benefits offer public health services for free, which are meant to cater to any health requirement of the individual.
    • Child Benefit – Parents with young children are provided child benefits in the form of monetary payments, paid monthly or annually to look after the needs of their children.
    • Unemployment Benefit – Unemployed jobseekers are paid an allowance till they find a job.
    • Housing Benefit – Low income families are provided with immediate housing allowance. The allowance depends on individual conditions and varies according to the type of accommodation.

    There are other benefits offered by certain nations too, each benefit catering to needs in that country. Individuals who rely on such benefits fall under the ‘people on benefits’ category.

    What are loans for people on benefits?

    Surviving on benefits can be a struggle in this age of high costs. The benefit money provided may often not be enough to make ends meet and this is where loans can be a life saver. While it might seem hard for people on benefits to get loans there are a lot of institutions which do offer such loans. There are a few types of loans which can be availed by people on benefits, each one of them catering to specific needs.

    • Payday Loans – There are a few institutions which provide payday loans to people on benefits. These are generally small amounts with high interest rates and are expected to be returned when the borrower gets their benefits.
    • Budgeting Loans – This loan can be availed by those who have been receiving benefits for a year. These are interest free loans with long repayment periods.
    • Home Finance Loans – These are available in certain countries and can be availed by families which have received benefits for a few years. They can be used for any purpose and weekly repayments are to be made. These loans come at very high interest rates and can be an expensive proposition.
    • Low Income Loans – Some banks offer low income loans for people on benefits. These loans can be availed only if the benefits money amounts to a certain value per week. Repayment is on a weekly basis.
    • Secured Loans – These loans are provided against some security. The most common security is cars and the interest rate is often lower than payday loans.

    Features of loans for people on benefits

    • Varying Interest – The interest charged on loans for people on benefits varies depending on the kind of loan and the institution offering it. Certain institutes do not charge any interest rate on these loans whereas some of them charge interest rates as high as 30%.
    • No guarantee – A majority of such loans can be availed without any guarantee.
    • Flexible repayment options – These loans come with flexible repayment options, intended to suit the needs of the borrower.
    • Minimal Paperwork – Loans for people on benefits can often be obtained without hassles and with minimal paperwork.
    • Multipurpose loans – The loan availed can be used for multiple purposes and is aimed to meet any immediate requirements.
    • Cash in hand – Such loans generally provide cash in hand to meet pressing needs. Loans can be availed for amounts as low as a few hundred dollars to a few thousand dollars, depending on the individual.
    • No upfront fee – Most lenders do not charge an upfront fee to sanction a loan for people on benefits.

    Eligibility criteria

    • The applicant should be a resident or citizen of that country.
    • The applicant should be 18 years and above.
    • The applicant should have a bank account in the country.
    • The applicant must be getting financial aid from the government.

    Concept of people on benefits in India

    India does not have a strict concept of ‘people on benefits’ and is regarded as a different welfare state compared to United Kingdom or the United States of America. While there might be no strict definition of ‘people on benefits’ in India, there are numerous schemes designed to help the poor and weaker sections of society.

    The Government of India offers special schemes and privileges to senior citizens, citizens whose income falls below the poverty line and certain minorities. Citizens do have access to government health services and schools but the concept of living on benefits provided by the government does not exist in entirety in India. There are different schemes sanctioned by both the Central and State Governments to cater to the needs of citizens in distress, each one targeted towards a particular segment of the population.

    Certain benefits and privileges are provided to specific populations, based on their socio-economic condition. A category which might come close to ‘people on benefits’ is mentioned here.

    Below Poverty Line (BPL) Families

    Families with an income below the poverty line are termed as Below Poverty Line (BPL) families and the government has special schemes for them. The poverty line is determined by experts based on current living conditions and the money needed to etch out a basic living. The current poverty line is Rs 32 in villages and Rs 47 in cities. Individuals who spend less than this amount are considered to be living below the poverty line and are eligible for government schemes and plans.

    Below Poverty Line Loans

    The government has a few schemes designed to benefit people who are below the poverty line. Some of them are mentioned below.

    Swarna Jayanthi Shahri Rozgar Yojana

    The Swarna Jayanthi Shahri Rozgar Yojana (SJSRY) scheme is designed to provide loans to individuals who are below the poverty line. It is aimed to provide meaningful employment ventures in urban areas and improve the overall quality of life of the individual.

    Features and Benefits

    • Unemployed Loan - The loan can be availed by unemployed individuals from both rural and urban backgrounds to set up self-employment opportunities.
    • Subsidy - A subsidy of 15% of the project cost is provided, subject to certain maximum limits.
    • High Loan Amount – Individuals can get a maximum loan amount of up to Rs 50,000 to set up gainful self-employment opportunities.
    • Group Loans – Loans under this scheme can be availed by both individuals and groups.
    • Extra subsidy for women – Women who avail this loan can get a subsidy of 50% of the project cost.
    • Fast approval – The entire process takes around two weeks and the money can be obtained within a set time period.

    Eligibility Criteria and Documents Required

    • The applicant must hold a Below Poverty Line ration card.
    • The age of the applicant should be between 18 years and 50 years.
    • The applicant should have knowledge about the project he/she intends to start.
    • Passport size photographs.
    • The workspace should be available.
    • There are no minimum educational qualifications but the applicant should not have completed more than 9th standard.

    Interest Rate

    The interest rate for this loan depends on the activity financed and varies accordingly.

    Repayment

    The money obtained as loan can be repaid in 3 to 7 years, depending on the repayment capacity of the individual and the agreement entered upon.

    Swarna Jayanti Gram Swarozgar Yojana

    The Swarna Jayanti Gram Swarozgar Yojana is a scheme designed to provide gainful self-employment opportunities in rural areas of the country.

    Features and Benefits of Swarna Jayanti Gram Swarozgar Yojana

    • High Loan Amount – Individual applicants can get loans up to Rs 50,000 and groups are eligible for loans up to Rs 6.25 lakh.
    • Low Margin – There is no margin amount for loans up to Rs 50,000. Loans above Rs 50,000 attract a margin of 20% minus the subsidy.
    • Subsidy – A subsidy of 30% of the project cost is provided, subject to a maximum ceiling of Rs 7500 for general category and Rs 10,000 for SC/ST individuals. Groups can get a subsidy of up to 50% of the total project cost, subject to a maximum of Rs 1.25 lakh.

    Eligibility Criteria and Documents Required

    • The applicant must hold a Below Poverty Line ration card.
    • Applicant should have knowledge of the project.
    • Passport size photographs.
    • The age of the applicant should be above 18 years.

    Interest rate

    A fixed interest rate of 8.75% per annum is charged for loans up to Rs 50,000. For loans above Rs 50,000 a fixed interest rate of 9% per annum is charged.

    Repayment

    The loan can be repaid in 5 to 9 years, depending on repayment capabilities and the agreement worked out with the lending agency.

    Prime Minister’s Employment Generation Scheme

    The Prime Minister’s Employment Generation Scheme is designed to create employment opportunities in both rural and urban areas by empowering individuals to set up self-employment generating units. Banks provide loans to unemployed youths under this scheme, so as to bridge the gap between the upper and lower classes.

    Features and Benefits

    • High loan amount – Applicants can get loans up to Rs 25 lakh per project.
    • Subsidy – Individuals get subsidies ranging from 15% to 25% of the project cost, depending on certain conditions.
    • Low Beneficiary Contribution – Loan beneficiaries need to contribute only 5-10% of the total project cost.

    Eligibility Criteria and Documents Required

    • The applicant should be above 18 years old.
    • The applicant should have a minimum educational qualification of 8th standard pass.

    Repayment

    The loan amount should be repaid within 3 to 7 years of the loan being taken.

    The government has other special schemes wherein eligible individuals can avail loans from financial institutions to further their cause and improve their standard of living.

    Loans for People on Benefits Reviews

    • Axis Bank Personal Loan
      "Excellent service"
      0.5 4.0/5 "Great!"
      I have applied for Axis Bank Personal Loan through online .The agent clearly explained the process of the loan.The rate of interest was as ok and the processing fee was also ok. while submitting the documents not yet faces any issues .The documentation part was more.The loan amount got on time .The loan amt was sufficient s well .The Overall Service is Good.
      Was this review helpful? 0
      , chennai
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "Excellent service"
      0.5 4.5/5 "Excellent!"
      I came to know about Bank bazaar through advertisement only.Then i have checked for credit score .Bank bazaar is providing very good service as of now need to avoid calling the same person frequently.Then i have tried to apply for Tata Capital Personal loan .The agent clearly explained the process of the loan and not yet faced any issues as of now.The rate of interest was little bit high and the processing fee was acceptable .The Overall Service is Good .
      Was this review helpful? 0
      , chennai
      Reviewed on Mar 24, 2019
    • Tata capital Personal Loan
      "Excellent service"
      0.5 4.5/5 "Excellent!"
      I have applied for Tata capital Personal Loan.I have not faced any issues. The rate of interest was littile bit high and the processing fee was little bit acceptable.The agent clearly explained the process of the loan.I have not faced any issues till now .The Overall Service is Good and satisfactory .
      Was this review helpful? 0
      , chennai
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "GOOD PORTAL TO USE"
      0.5 4.0/5 "Great!"
      It is the first time experience with the Bankbazaar.com and i had a very good experience also i am using it through the mobile application as the application is user friendly and convenient to access. The customer service is very good and responsive. by explaining the details of the loan.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Mar 24, 2019
    • ICICI Bank Personal Loan
      "GOOD"
      0.5 5.0/5 "Blown Away!"
      I have been using the personal loan with the ICICI since from last few years the loan amount with them was good also the documentation process was simple and it was hassle free to use. The rate of interest with this nominal added on that the service is very good with this bank.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Mar 24, 2019
    • ICICI Bank Personal Loan
      "GOOD"
      0.5 5.0/5 "Blown Away!"
      I have taken the personal loan with the ICICI BANK the loan amount with this bank what they have offered was satisfactory. The rate of interest with this bank was nominal also i am using it since from last one year and it is good to use.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "ONE STOP SOLUTION"
      0.5 5.0/5 "Blown Away!"
      Bankbazaar.com i have been using it since from last few months and i have a very good experience i have been using it through the mobile application as the application is user friendly also it is convenient to access. The customer service is good and they are responsive.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Mar 24, 2019
    • IndusInd Bank Personal Loan
      "EXCELLENT"
      0.5 5.0/5 "Blown Away!"
      There is no particular reason for taking the personal loan with the INDUSIND BANK. The loan amount was good and the rate of interest was 10.5% which is nominal when compared to the others. The documentation process was easy and it is comfortable.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I came to know about Bank bazaar through online only .The Bank bazaar is the only online website giving all details about the banking products .I have applied for Tata Capital Personal Loan and not yet faced any issues .The agent clearly explained the process and not yet faced any issues as of now.The Overall Service is Good.
      Was this review helpful? 0
      , ahmedabad
      Reviewed on Mar 24, 2019
    • Tata capital Personal Loan
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have applied for Tata capital Personal Loan. No clue on the rate of interest and charges levied by them,The agent clearly explained the process .I have not faced any issues till now .I have cancelled the plan of taking the personal loan since not require the personal loan .
      Was this review helpful? 0
      , ahmedabad
      Reviewed on Mar 24, 2019
    • Kotak Personal Loan
      "EXCELLENT"
      0.5 5.0/5 "Blown Away!"
      The reason for taking the personal loan with the KOTAK MAHINDRA BANK is i am an existing customer customer with this bank. The loan amount was good also the rate of interest was 11.5% with this loan and the duration is for 48months for repaying he loan.
      Was this review helpful? 0
      , bangalore
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "USER FRIENDLY PORTAL TO USE"
      0.5 5.0/5 "Blown Away!"
      It is the first time experience with the Bankbazaar.com and i had a very good experience with the Bankbazaar.com. I am using it through the mobile application as the application is user friendly and convenient to access. The customer service is very good.
      Was this review helpful? 0
      , bangalore
      Reviewed on Mar 24, 2019
    • Early Salary Personal Loan
      "GOOD"
      0.5 5.0/5 "Blown Away!"
      It is the best loan that i have taken with the EarlySalary when compared to the other so i have taken this loan. The documentation process was simple and and also i got a loan within a day after the documents. The loan amount was lesser with this loan as they have given also the rate of interest was lesser.
      Was this review helpful? 1
      , bangalore
      Reviewed on Mar 24, 2019
    • HDFC Bank Personal Loan
      "GOOD"
      0.5 4.0/5 "Great!"
      I have applied for the personal loan with the HDFC BANK and have been using it since from last few years and the documentation process was simple and it is easy procedure to get the loan. I got the loan within 10-15 days with this bank. The rate of interest was lesser with 11.5% with 4 years of duration.
      Was this review helpful? 1
      , bangalore
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "USER FRIENDLY PORTAL TO USE"
      0.5 5.0/5 "Blown Away!"
      Bankbazaar.com i am using it from last one year and i have a good experience and i am using it through the mobile application as well as the website both are easy and user friendly portal to access. The customer service is good and they are responsive.
      Was this review helpful? 0
      , bangalore
      Reviewed on Mar 24, 2019
    • Early Salary Personal Loan
      "GOOD"
      0.5 4.0/5 "Great!"
      The loan amount was lesser along with that it is with lesser duration which is comfortable so taken the personal loan with the EarlySalary. The documentation process was simple and the documents collected at the doorsteps. I got the loan within 8-10days with this loan also, the loan amount is good with 12-13% of rate of interest.
      Was this review helpful? 0
      , bangalore
      Reviewed on Mar 24, 2019
    • Axis Bank Personal Loan
      "GOOD"
      0.5 5.0/5 "Blown Away!"
      I have applied for the consumer durable loan with the AXIS BANK they have offered with the good loan amount also the documentation process was simple to get the loan. I have taken the MOBILE PHONE with this bank, the duration for repaying the loan is for 9 months.
      Was this review helpful? 0
      , ahmedabad
      Reviewed on Mar 24, 2019
    • Bank Bazaar Personal Loan
      "CONVENIENT PORTAL"
      0.5 4.0/5 "Great!"
      Bankbazaar.com this is the first time experience as i have been using it through the website the portal is convenient also it is user friendly to access.The customer service is good and also they are good by explaining the details of the loan.
      Was this review helpful? 0
      , ahmedabad
      Reviewed on Mar 24, 2019
    • Early Salary Personal Loan
      "AVERAGE"
      0.5 4.0/5 "Great!"
      The documentation process was good with the EarlySalary where i have applied for the personal loan. The loan amount was good also the processing fee was nominal. The rate of interest was higher with this loan when compared to the other loans.
      Was this review helpful? 0
      , ahmedabad
      Reviewed on Mar 24, 2019
    • Early Salary Personal Loan
      "Excellent service"
      0.5 5.0/5 "Blown Away!"
      I have applied for Personal Loan Early Salary. The agent clearly explained the process .The rate of interest was nominal and the processing fee was nominal. I have got loan amount on time .The loan amount was sufficient and not yet faced any difficulties.The Overall Service is Good and Satisfactory .
      Was this review helpful? 0
      , gurgaon
      Reviewed on Mar 24, 2019
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