Consumer Durable Loan

Consumer goods such as refrigerators, microwaves, washing machines, etc. are essential these days. However, purchasing one or more durable items for your home involves significant costs. You can apply for a permanent consumer loan if you do not have sufficient savings.

What is a consumer durable loan?

A consumer durable loan is a financial product provided by banks to customers for purchasing consumer goods such as phones, cameras, refrigerators, laptops, and home theatre systems. It can be in the form of a personal loan or a line of credit. The repayment period for these loans is typically shorter, ranging from 24 to 36 months. The interest rate and loan amount may vary based on credit score and monthly income. Different lenders offer different interest rates, determined by factors such as credit score and monthly income.

Features of a Consumer Durable Loan

These are some of the characteristics of a consumer durable loan:

• You can get financing for up to the full cost of the consumer durables you want to purchase.
• You can choose EMI options extending up to 36 months or even longer.
• There is no need to provide collateral or have a guarantor.
• The documentation required is minimal.
• The eligibility criteria are not as strict.

Leading Banks/NBFCs offering Consumer Durable Loans

Below are a few of the top banks that provide loans for consumer durables, along with their initial interest rates.

Banks	Minimum Rate of Interest
SBI	15.65% (on selected products)
Tata Capital	0% (on most products)
Bajaj Finserv	0% (on selected products)
HDFC bank	16%
Fullerton India	11.99%
IDFC First	0%
Induslnd Bank	0%

What are the eligibility criteria for a consumer durable loan?

To be eligible for a consumer durable loan, you must meet the following criteria:

• Be at least 18 years old
• Be an Indian citizen or resident
• Hold an Aadhaar and PAN card
• Be either salaried or self-employed
• Have a minimum monthly income of Rs.15,000.

Document Required for Consumer Durable Loan.

To apply for the loan, you will need to provide the following documents:

• Proof of identity, such as PAN card, Aadhaar card, driving license, or passport.
• Proof of income, including salary slips and form 16.
• Proof of age, such as a birth certificate or any other valid document.
• Proof of address, which can be utility bills.
• Recent coloured photographs.
• Bank statements.

What is the interest rate for a consumer durable loan?

The interest rates for a consumer durable loan differ among lenders and typically range from 12% to 22%. Certain lenders may also provide promotional offers with 0% interest. Additionally, most lenders impose a nominal processing fee, typically 1% to 3% of the loan amount.

How long does it take to get approval for a consumer durable loan?

Most lenders can approve consumer durable loans in just a few minutes. This fast approval is because these loans typically have small amounts and require fewer documents.

Consumer durable finance is a versatile loan option that can be utilised for purchasing various household electronic appliances, smartphones, or high-value gadgets. Below are some common scenarios in which individuals typically seek this type of loan.

Relocating to a new residence	Upon purchasing a new dwelling and settling in, it becomes necessary to equip it with various appliances, such as a modular kitchen, washing machine, air conditioners, and other essential items. However, the cost of acquiring a new home can strain one’s budget, making it challenging to afford furnishings immediately. In such circumstances, consumer durable loans prove to be advantageous.
Replacing existing appliances	Every electronic device has a limited lifespan. For instance, a smartphone may last approximately 4 to 5 years, while a washing machine typically endures for 10 years, and so forth. If any of your high-end appliances unexpectedly cease to function, this loan can assist in covering the unforeseen expenses.
Gifting for various occasions	When considering presenting a home appliance as a gift to a friend or close relative on occasions such as weddings, anniversaries, birthdays, or festivals, opting for consumer durable loans allows for the purchase of high-end gadgets, such as watches, laptops, mobile phones, and more, without the need to pay the entire amount upfront.

How to get a consumer durable loan?

To obtain a consumer durable loan, start by accessing an online instant loan application and completing the digital loan application form. The lender will assess your application and deposit the funds into your account within a few hours. Subsequently, you can use the money to purchase a consumer-durable or desired item.

Getting a consumer durable loan is a straightforward process. Let’s say you want to purchase a laptop. You visit the XYZ dealership to finalise your laptop choice. At the store, you will see representatives from different financial institutions. 

All you have to do is provide your KYC and income certificate to any of the lender’s representatives. They will then upload these documents to their database, conduct a quick credit check, and transfer the funds to the dealership’s account from where you made the purchase. 

Alternatively, you can also apply for a consumer durable loan online through the lender’s website. If you are buying from an e-commerce platform, you will have the option to pay in instalments (EMI).