Loan repayment is the act of paying back previously borrowed money, such as personal loans, home loans or education loans. This repayment includes both the principle and interest. Not repaying for long period will result in bad debt and being called a delinquent by the authorities.

Sometimes, being able to change the mode of repayment of a loan could prove convenient toward repaying loans. To that end, we look at some ways to change the mode of repayment for a loan:

What are the Different Modes of Loan Repayment

Standing Instruction: In this mode, you give the lender (where you are already a customer with a savings account ) permission to access your account to withdraw the EMI owed to them by you automatically.

This method involves no hassle or procedure each month. You can also specify on which date the lender can withdraw the EMI. You need to keep your account funded to make sure the EMI payment is not missed when the bank tries to withdraw the EMI. This way you will not miss any payments.

Post Dated Cheques: This involves giving post dated cheques equalling the loan tenure to the lender, which they will submit to the bank on the date specified on the cheque. This is not available in all areas. It is also like SI but a more traditional way where the cheque has to be physically sent to the borrower's bank instead of the funds withdrawn electronically.

Electronic Clearing Service: ECS is based on the same principle as SI where you'll give the lender bank access to take the EMI from your account. The lender bank will then give the signed consent form and cancelled cheques to your banker, who will approve the transaction of EMI from your account. ECS can be used if you don't have an account with your lender bank.

How to Change Your Mode of Loan Repayment?

You have to begin by reaching out to the nearest bank branch and filling up a request form. Here's the process to be followed for SI, ECS and cheques:

Standing Instructions

1. Request a form for swapping repayment instructions.
2. Three security cheques favouring ‘Lender Bank with Loan Account No.' The cheques should be undated and filled with a value equal to the sum of three EMIs.
3. In case a bearer submits the request on your behalf, a bearer authorization along with KYC documents of the bearer, such as ID and signature proof (PAN Card, Aadhar Card, Driving License or Passport Copy) will also need to be provided.

Electronic Clearing Service

1. Request form for swap of repayment instructions.
2. Security cheques favouring ‘Lender Bank with Loan Account No.'
3. ECS mandate duly filled and verified by your banker.
4. Swap Charges of Rs.500/- favouring ‘Lender Bank with Loan Account No.'
5. In case a bearer submits the request on your behalf, a bearer authorization along with KYC documents (self-attested copy and original for validation) of the bearer such as ID and signature proof (PAN Card, Aadhar Card, Driving License or Passport Copy) will also need to be provided.

Post Dated Cheques

(Only allowed if the location is non-ECS)

1. Request form for swap of repayment instructions
2. Revised post dated cheques in favour of ‘Lender Bank with Loan Account No.' for the balance EMIs.
3. Swap charges of Rs. 500/- favouring ‘Lender Bank with Loan Account No.
4. In case a bearer submits the request on your behalf, a bearer authorization along with KYC documents (self-attested copy and original for validation) of the bearer, such as ID and signature proof (PAN Card, Aadhar Card, Driving License or Passport Copy) will also need to be provided.

When you take loans using the mPokket instant loan app, be it an education loan, a service loan, or a salary advance loan, timely repayments improve your CIBIL score, which will help you be eligible for larger loans and even improve your employment prospects.

That's why, If you are seeking an instant short term loan or salaried loan and wondering where to turn for some quick credit, simply Simply download the mPokket online loan app, register by uploading a handful of documents, and post the online loan approval, borrow instant personal loans of up to Rs. 50,000. mPokket instant loans for students online and instant loans for salaried are both credited straight to your bank account.

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With stock trading so accessible and so with so many different options among stocks to buy today, nearly everyone from college students to working professionals are trying their hand at the share market. And why not? If you have a pulse of the Indian stock market, know what you're doing and make wise, well-informed decisions, you could stand to benefit.

However, just as properly timed decisions to buy or sell stocks will pay off for you, ill-timed decisions could end up costing you.

With that in mind, here are six things to remember before selling your stocks:

Lower Trading Volume

When you find that a stock is unexpectedly trading at a lower volume than before, it might be a sign of trouble. Stock liquidity - a measure of how quickly a stock can be bought or sold – is a crucial factor if you're wanting to sell stocks that are not performing well. If you're unable to sell your stock for a lack of buyers, you should have to hold on to it and hope the company can get through the rough patch it's going through.

Reduced Dividends

If you see companies cutting back on dividends, or even getting rid of them entirely, it's time to take a hard look into their internal workings. You should be checking the monthly and quarterly performance of the companies that issue your stocks.

Pay extra close attention if a company cuts dividends as it could hint at a more serious event at play. Perhaps, it's a sign of cashflow trouble or other changes or issues that could affect the stock value.

Financial Ratios

It's great if one of your stocks had a good return, but always stay alert and look for any signs that it might start to decline. There are many such signs and they can often be found in the form of financial ratios.

The health of a company which issues the stock can be measured through a fundamental analysis, which is a close audit of financial statements. Those who know the market well use financial ratios to obtain insights and predict how a company will fare in a given timeframe.

However, since companies keep their financial details closely guarded, the figures used to compose the ratios can be difficult to obtain.

Target Prices

Traders set a floor on a share price so that should it drop below a certain level, they sell it to maintain a profit. You can also set an upper limit that would trigger your sale.

This is because you might be afraid that the stock will have a hard time supporting a market price above a certain level, and that any bad tidings could send the share price into a nose dive. Setting limits on when to sell and when to buy ahead of time can help control your apprehension.

Over time, this practice could end up benefiting you, with higher profits, as you'll be less likely to sell too soon or give in to panic-selling.

Selling Strategies

Make a habit of consider the bigger picture when you consider selling your stocks. If you have a feel for the market, about things which could affect stock value, you'll have a better grasp of the need to take timely action.

Hold on to some of your holdings

Should you have good profit in a stock, consider selling only a portion of your shares. Reinvest the profits into other stocks that are doing well, and let the others be as they are. This way, you'll spread the risk over a wider range of assets while still profiting. If the stocks you keep begin to plummet, you can always sell them and hopefully come away with some profit.

As stated earlier in our ‘6 things to keep in mind for achieving financial freedom' blog, wise share market investment is one of the keys to financial freedom, and it's never to early to start. When you need to buy some stocks, you can always turn to the mPokket instant loan app to get some quick credit.

If you are seeking an instant cash loan or quick student loans and wondering where to turn, simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant personal loans of up to Rs. 50,000! mPokket loans for students and loans for salaried are both credited straight to your bank account within 10 minutes.

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2020 saw a virus bring the whole world to a standstill. And just when it seemed like the worst was over, the second wave of the COVID-19 pandemic came out of nowhere and wreaked havoc across the nation.

Nearly four lakh people died and many of them were their family's breadwinners. Reportedly, half of those who died were aged below 60 years.

It all goes to underscore the importance of having a sound financial back-up plan in the form of a life insurance policy to protect your family financially in your absence.

With so many families left to fend for themselves owing to the loss of the sole income-earning member, a life insurance policy in such situations can come to the rescue as it can help the family to overcome financial difficulties, if not the emotional setback.

Why is life insurance important?

Life Insurance is a financial cover for a contingency linked with human life, such as death. While a value cannot be ascribed to a human life, a monetary sum could be determined based on the loss of income in future years. Since there is loss of income to the household when human life is lost, the payout from a life insurance plan can provide comfort in such times by compensating for the lost income.

Life insurance is a means towards ensuring that your immediate family has some financial support to fall back on in the event of your untimely demise. It could be to repay debt like a home loan or achieve financial goals like children's higher education or old-age care for parents or spouse.

How much insurance cover do I need?

There's no perfect formula. Consider your present lifestyle and future needs while arriving at a figure. In case the sum assured is not carefully evaluated based on the future needs of the family, the insurance proceeds may exhaust sooner than you know.

The concept of life insurance is that if something unfortunate happens to the policy holder, his/her family can continue leading a comfortable life. That is possible only if the payout under the insurance policy is enough to compensate for the lost income due to the death of the policyholder for a reasonable number of years.

Which insurance policy is right for me?

There are various types of life insurance plans available in the market but most popular among them are Term Insurance Plans and Unit Linked Insurance Plans (ULIPs).

Term Life Insurance

In a term life insurance plan, the policyholder pays premium to the insurance company to get coverage against death. In case of the policyholder's demise within the policy period, the insurance company pays the sum assured to the nominees.

Term insurance is one of the preferred life insurance product as it provides a significantly large cover at affordable premiums.

Unit Linked Insurance Plans

ULIP or Unit Linked Insurance Plan is a type of life insurance policy, which offers you the benefits of market-linked wealth creation and life insurance coverage. They are amongst one of the preferred choices for securing one's long-term life goals.

As a policyholder, you have the opportunity to invest in a number of market-linked ULIP funds depending on their risk profile and investment horizon. At the same time, you get to enjoy the benefits of life insurance cover. Through the investment component, you can invest in equity, debt funds or a combination of both.

Both term insurance and ULIP plans come with tax benefits at the time of investment as well as at the time of maturity, as per the Income Tax Act 1961, subject to specified conditions.

Insurance is, by and large, a useful tool to have at your disposal. Life throws unexpected curve balls at us when we least expect, and it's good to have the means to tackle those situations in some capacity, at least.

Similarly, at mPokket, we realize that despite your prudent financial planning, from time to time, you might face a financial emergency of some form. During those trying times, you'll need a trusted friend by your side, someone who will not just provide moral support but will help you out financially as well.

mPokket is one of the best instant loan apps in India when you need some quick credit. You can easily obtain an instant student loan or salaried loan. Simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and loans for salaried are both credited straight to your bank account within 10 minutes.

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As a student who's on the verge of entering the working life or even a seasoned young professional, it's never too early or too late to learn how to recover from financial setbacks, such as poor credit scores.

We realize it might be difficult to maintain a good credit score during your college life. But it's worth trying for, since it can open up a lot of opportunities as you lay down the foundations for your career and future.

After all, a credit score could be the deciding factor behind buying a car, home or even paying rent. With more money-lending services being made available to students, it's led to increased cognizance about CIBIL scores among students.

If you wish to start fixing your credit score, here are some suggestions:

Revolving debt over instalment debt

Put simply, revolving debt is what you incur when you're in the habit of using a credit card. Prioritize paying off your credit card bills over say, student loan instalments or rent bills, as the interest on your credit card bill can pile up much faster. To maintain a good credit score, your credit card utilization should be 30 percent (or lower) of your total limit as well.

So if you ever find yourself spending over this limit, make sure to cut down on your expenses until you've reached the 30 percent mark. However, sometimes your essential expenses may incur more than this limit which brings us to our next point.

Go for your own credit card

As long as you're a beneficiary of an account belonging to a family member with a good credit score, it shouldn't be too difficult to obtain a credit card. Once you do, however, make sure your credit card is not abused always exercise caution when using it.

Try for a higher credit limit

Being eligible for a higher credit limit depends on whether you pay your credit card bills regularly. As time passes on, your credit score will improve as long as you've been making your payments duly as well as if you've been maintaining your credit card spending under the limit of 30 percent.

If you apply for a higher credit limit on your credit card, your score is likely to improve as it will be easier to stick to the 30 percent rule. That said, if you're already struggling to make your existing credit card payments, a larger credit limit may not be the best choice.

Pay rent with your credit card

The more positive payments you have on your credit card, the better your credit score will get. Paying off your rent with your credit card will add a positive payment on your credit history as long as you duly pay it off yourself when the amount is reflected on your credit card bill. This amount should be paid off before the billing period of your credit card though as rent paid with your credit card can accrue interest as well which will reflect poorly on your credit score. We should also mention that this option may not always be available as some landlords may not be comfortable with accepting credit cards as a mode of payment.

Review your credit score regularly

As per the law, every individual is allowed to get one free credit report from one of the three major credit companies every year. Make it a habit to check your credit report at every opportunity as errors on these documents are more common than you think. Most errors that have been reported to these credit bureaus are usually pertaining to incorrect information such as a misspelt name, wrong birth date or sometimes even being accidentally declared as deceased. Imagine trying to apply for a loan if your credit file says that you're dead; that's just a headache no one wants to deal with.

At mPokket, we exist to provide financial independence to youth and empower them with the means to be economically self-reliant.

So of you are seeking some quick credit by way of an instant student loan or salaried loan and wondering where to turn, simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant personal loans of up to Rs. 50,000! mPokket loans for students and loans for salaried are credited straight to your bank account within 10 minutes.

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The importance of having a decent credit score cannot be overstated. The need for a loan can arise at any time and being unable to get it on account of a low credit score can be quite problematic.

In most cases, a good credit score (750 or above) is mandatory. Falling below that by a considerable margin could cause you a lot of problems, such as these:

Affect your well-being

Not having access to credit when you need it most can affect your mental well-being and might force you to turn to the unorganized sector, at a much higher rate of interest to boot.

Credit Rejection

In situations that call for an urgent need of credit, such as medical emergencies, having a loan request rejection can pose a big problem. It can add to the burden of finances that you already need support for with credit.

Unfavorable terms if loan approved

If your credit score is in the range of 600-700 and say you're approved for a loan on account of good repayment capability, it will come at higher bank loan interest rates or at a higher amount of down payment, neither of which are preferrable options.

How to improve credit score

But it's not all doom and gloom if you happen to have dropped your credit score too low, here's what will be needed to be done for your part to improve credit score:

Find out the reason for the low score

A good first step would be to obtain your credit report, which can give you a clue about which factor is bringing your score down. Once you are aware of the factors pulling your score down, it is easier for you to take appropriate actions for improving your creditworthiness.

Prioritise repayments

Paying of EMIs or outstanding credit card bills on time is how you can lay the foundation for a good credit score. Start by pausing all your non-essential expenses and putting them towards your repayment of existing debts.0

Look before cancelling old credit cards

Another key factor behind your credit score is your credit history. If your credit history shows you act responsibly towards credit over long stretches of time, your older credit cards still in healthy standing can help your credit score. Therefore, it's advisable to not close your older accounts which are not being used by you.

Have a good mix of secured and unsecured credit

There are two types of credit - secured and unsecured credit. Secured credit requires an asset to be pledged or secured against your loan, while unsecured credit is free from such requirements. Home loans or vehicle loans are examples of secured credit, while personal loans and credit cards are examples of unsecured credit.

If you have a healthy mix of these two types of credit, it's a good indicator of a responsible borrower as it shows that the credit is not being used only for spending but also for building assets.

Limit your credit application

Each credit application you make results in a hard inquiry. Consequently, more of these hard inquiries eventually lead to a low credit score.  So, if you are wanting to improve your credit score, don't apply for credit during the interim period.

Only when your credit score begins to show a decent amount of improvement should you try to get a loan again. If you apply any sooner, you risk further downfall in the score due to rejections for bad credit score.

Remember that your credit score cannot be improved overnight. It requires consistent and dedicated effort from your part. So, don't lose hope, and follow the suggestions above.

And to know more about credit score reports, credit history check and more, know more about Top credit bureaus in India and how they affect your credit score.

At mPokket, we are very cognizant of the need to ingrain the importance of financial freedom from a young age. After all, our purpose is to provide financial independence to youth. With world-class technology, transparent communication and quick decision-making, we enable today's youth to attain financial independence.

It's possible that from time to time, you're in urgent need of some quick credit. If you're seeking an instant student loan or salaried loan and wondering where to turn, simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and instant loans for salaried are both credited straight to your bank account within 10 minutes.

Even until a decade ago, if you were planning to get a loan, your options were limited to the public and private sectors, and informal lenders. But over the past few years, non-banking finance companies (NBFC) have changed things around considerably.

What're the differences between banks and NBFCs?

Both private and public sector banks are regulated by the Reserve Bank of India (RBI). NBFCs, while also registered with the RBI, falls under the purview of the Companies Act of 1956. 

Banks follow a stringent loan approval process while NBFCs veer more towards leniency. Also, banks and NBFCs have different personal loan interest rate benchmarking systems.

While bank interest rates rely on the vagaries of RBI policy rates and market forces, NBFCs have control over interest rates charged to customers because of internal benchmarking.

Benefits of NBFC

Speedy approval and disbursal

NBFCs can get a loan approved within a matter of minutes, and the quicker approval means faster disbursal of the amount.

Risk assessment is automatic

The underwriting process is significantly faster in NBFCs, thanks to automated technology, which in turn has increased the speed of the application process. Also, this process lowers operating costs, which allows the NBFCs to give you a more competitive offer than bank loan interest rates.

Strong security system

NBFCs use highly advanced security technology to ensure that their customers' sensitive data is safe.

Superior data utilisation

NBFCs do not base their decision to lend you money solely on your credit score but numerous other data points are also considered when scanning your loan application.

More inclusive

For many customers that have been refused loans by banks and other institutions, NBFCs are lifesavers. They've been able to meet a variety of financial demands of such customers. Even business owners, to might've struggled to get a loan from a conventional bank, are able to get it from NBFCs.

Unique offerings

Customers these days have far more unique loan requirements than in the past. Just take, for example, the many startups that are taking off each day. In that regard, NBFC loans offer diverse options to meet these unique financial requirements, which has helped the healthy growth of the lending market.

Why consider NBFCs over banks for loans?

End to End Online Application Process

With just a few details, customers can complete the loan application process online.

Insta-approval

Customers can receive loan approval within a few minutes after applying with an NBFC for a personal loan.

Faster Processing

While the traditional loan process takes up to a few days, if not weeks, NBFCs can process a loan application within just 24 hours post-approval. Thus, you can count on them for your urgent needs.

Lower Interest Rates

Since NBFCs' base interest rates are on the basis of prime lending rate, which is not regulated by the RBI, they offer higher flexibility and more competitive rates of interest.

Top-quality customer service

NBFCs generally customer service that's far superior to banks. It's more personalised and heavier on attention to detail.

Eligibility Criteria

NBFCs have eligibility criteria that are not too hard to satisfy, which serves to extend their range to more customers. Having a low credit score isn't usually a big issue either since NBFCs consider other aspects than just your repayment capacity.

Minimum Documentation

NBFCs require minimum documents to process the loan, unlike banks where customers are bogged down with exhaustive paperwork.

All these advantages apply for mPokket, which is an NBFC. When you take loans using the mPokket instant loan app, be it an education loan, a service loan, or a salary advance loan, timely repayments improve your CIBIL score, which will help you be eligible for larger loans and even improve your employment prospects.

That's why, If you are seeking an instant student loan or salaried loan and wondering where to turn for some quick credit, Simply download the mPokket online loan app, register by uploading a handful of documents, and post the online loan approval, borrow instant personal loans of up to Rs. 50,000. mPokket instant loans for salaried and loans for students online are both credited straight to your bank account.

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In life, from time to time, we might encounter a shortage of funds to meet some unforeseen financial obligations or even unexpected immediate financial emergencies. 

That's where short term personal loans can prove quite useful. Basically, short term personal loans are loans that can be repaid within a one to two-year period. Short term personal loans are unsecured loans and as such, it is not required by you to post any sort of collateral as security. 

The funds are credited to your account quickly after the loan gets approved. However, it's important for you to note that the term "short term" is not due to the speed at which the funds are disbursed but the limited tenure for repayment.

When you opt for a short-term loan, the money outflow that goes into paying the total interest is significantly lower compared to a long-term loan. As a result, a short-term loan is cheaper than a long-term loan.

Advantages of short term loans

Lower time to incur interest

Given that short term loans need to be paid off within about a year in most cases, the total interest payments are lower too. Especially when compared to long term loans, the interest amount you pay is considerably less.

Faster funding time

Due to their shorter maturity period, short term loans are less risky than long term loans. This is because a borrower's capacity to repay the loan is less likely to change much over the short timeframe. As a result, the time taken by a lender to underwrite process the loan is shorter, which means you'll be able to obtain the needed funds more quickly.

Easier to acquire

Short term loans can be very useful for those who have below-par credit scores as the requirements are usually easier to fulfil. That's partly because short term loans are generally taken for small amounts.

Disadvantages of short term loans

The main disadvantage of a short term loan is that it's only for small amounts. This is so that the borrower won't be burdened with large monthly payments, thanks to the loans involving smaller amounts that are repaid sooner. 

How to apply for a short-term loan online?

There are two different ways to go about applying for short term loans online and below, we take a look at them:

Website

If you're using a desktop computer or kiosk, you can head over to the lender's official website. Once there, click on the section marked for loans and from the different types of loans it presents you, select short term loan. You then have to complete the application process online, providing the required details. The documents required such as ID proof, address proof and income proof can be submitted online.

Apps

This is fast becoming the preferred way of applying for short term loans due to the proliferation of smartphones among the population. Usually, the lender's application can be downloaded from the Google Playstore or Apple app store following which, the entire loan application process can be completed using the mobile phone only. No physical documents need to be submitted and the customer does not need to visit any place to get the loan approved and disbursed to his bank account.

Eligibility

Here are the eligibility criteria for obtaining a short term loan:

• You must be an Indian resident
• You must be currently employed for at least the last six months
• You should have professional experience lasting over a minimum period of one year
• You need to be employed with a private limited company or public sector undertaking. The latter includes central, state, and local bodies.
• Your minimum income should be Rs. 20,000 per month at least. And if you happen to reside in Delhi or Mumbai, your monthly income has to at least Rs. 25,000.
• You must be between 21 and 60 years of age.

What documentation do I need for getting a short-term loan?

You need some basic documents in order to obtain a short-term loan. These usually include:

• ID proof
• PAN Card
• Proof of residence (Passport/Driver's license/Voter's ID/Phone or Electricity bill)
• Last three months' statement of bank where your salary is credited
• Last three months' salary slips
• One passport-size photograph

However, do note that the documents needed can change from one lender to the next, so ensure you check with your lender which specific documents will be needed from your end for getting short term loan.

We often face situations where we are in dire need of funds, such as for wedding expenses, school fees, or even medical emergencies. At mPokket, we aim to meet your financial needs and become a part of your life's journey.

That's why, If you are seeking an instant student loan or salaried loan and wondering where to turn for some quick credit, simply download the mPokket online loan app, register by uploading a handful of documents, and post the online loan approval, borrow instant personal loans of up to Rs. 50,000. mPokket instant loans for students and loans for salaried are both credited straight to your bank.

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There's no doubt that loans and other similar such credit avenues are immensely convenient. They let us explore options that otherwise might not have been possible and, in many cases, they're lifesavers. Nowadays, you can even get online loans at the click of a button.

However, there's also the part where the loans need to be repaid with interest. After you've reaped the benefits of the loan, you have to set about the process of repayment. And just as when you got those personal loans online in the event of a cash shortage, you could be faced with similar shortcomings during the phase of their repayment. After all, life can be unpredictable, as we all know by now.

That said, there are ways to offset your loan repayment without having to dig too deep into your precious savings or emergency fund. Here's how:

Take advantage of tax benefits: You can take advantage of loans that offer tax benefits, such as when you take a home loan or an educational loan. Before you go ahead with prepaying some of your loans, be sure to ascertain your cost benefits by doing a post-tax calculation. It might not always be worth your while to hold on to the loans which carry tax benefits.

Make timely use of your one-time or bonus receipts:  When it comes to prepaying your home loans, you could assign some of your one-time receipts from other sources. Not only that, but you could also use them to pay off your credit card debt or personal loans which bear high interest. 

Increasing your EMIs:  As a rule of thumb, your equated monthly instalments (EMI) should increase proportionately as your income increases. However, with the administrative process involved with changing your EMI, it might not always be feasible to do so. But at least try to do it every two years or so and you'll surely enjoy some benefits. 

Prepay using savings: One of the healthier ways to prepay is to put an amount of money every month in a savings plan such as a recurring deposit or debt mutual funds and upon their maturity, you could put it towards prepaying your outstanding bank loans.  The reason this is healthy for your financial well-being is it tends to inculcate in you a tendency for saving and also, you don't end up having to pay a sizable portion of the amount at one go.  

Make a budget and stick to it: As we've discussed previously, a budget is one of the most beneficial tools for keeping your finances in order. Sure, you may be eligible for a loan based on your income. However, what you do with that sum is up to you. Having a well thought out budget will prevent you from going for a heavy loan for a home or vehicle at a time when you could already be juggling some high-interest loans. After all, life can be unpredictable and a budget will help ensure you don't overstep a line that could force you to dip into your emergency funding.

Look at refinancing options:  Many loans offer refinancing options. It entails paying off the existing loan with a new one. It can be paid by the same lender or another. Look at this option only in cases where you've had to borrow at an extremely high personal loan interest rate or those where the tenures are too long. During refinancing, you could change the interest rate, tenure, or both. That said, it involves some charges. 

While these are some strategies that could help you reduce your loan burden, you will have to bear in mind that regular EMI payments will have to be made no matter what. Only then can you keep up a good credit score.  

At mPokket, we offer highly convenient repayment options as well as incentives for timely payments. After all, our purpose is to provide financial independence to youth. So, if you're in need of some quick credit, don't hesitate. Simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and salaried loans are both credited straight to your bank or Paytm account within 10 minutes.

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After the Indian government allowed private companies into the insurance sector in 2000, the sector has seen predictably rapid growth. And with more and more consumers realizing the importance of having insurance, especially now with the global pandemic, the insurance industry is looking to reach even greater heights.

That said, many people continue to see it less as an insurance policy and more as an investment, despite the best efforts of finance advisors against it. So, it's important for you to realize that and treat it as such.

That said, an insurance policy comes with its pros and cons, and it's important to look at both halves of the equation before you begin to use an insurance policy.

Pros of insurance policies

First let us delve into the pros of insurance policies:

Tax benefits: No matter which insurance policy you go in for, you are allowed to claim tax benefits of up to Rs. 1.5 lakh (under Section 80 of Income Tax Act, 1961). This is an important plus for a lot of people.

Coverage for your family in case of your untimely demise: Life can be unpredictable sometimes, and it is important to ensure your family is taken care of in the event of your passing. Having the best insurance policy will provide your family with the necessary help when you are not there to support them.

Benefit of compensation: While any financial loss due to untimely demise is compensated by your insurance, should the unthinkable happen before the tenure is completed, the financial loss covered under the policy can be claimed without having to jump through any major hurdles. It helps cut down on the mental strain following the incident.

Post-retirement financial support: Understandably, there are special insurance policies which are designed to support the individual post-retirement. As you reach the age where you're unable to earn an income, you're still financially taken care of to a fair degree. But it's important to purchase insurance at a young age so as to keep it on the cheaper side in the long run.

Helping a business run smoothly: In any business, due to a number of factors, unexpected losses can certainly occur. Having an insurance can help cover that loss. Also, an insurance policy taken for the employees of that workplace proves them with motivation, and thus smooth operation of the company.

Insurances for specific purposes: Any given insurance, be it for health, home, vehicle, or as applicable, has been specifically designed for that purpose. So, you won't have to deal with a one-size-fits-all situation.

Cons of insurance policies

Long-winded legal formalities: Regardless of the type of insurance you've applied for, you could be in for long-winded legal procedures first by the insurance company before you can claim the money.

Confusing terms and conditions: Often, in insurance policies, stipulated terms and conditions are written in tricky legal parlance such that at the time of claiming the insured sum, you could be denied a considerable amount. Of course, the onus falls on you to read the fine print before signing on, or consult a legal expert to go through it for you first.

Deliberate crimes: Sometimes, the beneficiaries of a given insurance policy could resort to wrongdoing to manually bring about the conditions needed for disbursement of the sum, such as deliberately setting fire to one's property or worse.

Insurance is, by and large, a useful tool to have at your disposal. Life throws unexpected curve balls at us when we least expect, and it's good to have the means to tackle those situations in some capacity, at least. 

Similarly, at mPokket, we realize that despite your prudent financial planning, from time to time, you might face a financial emergency of some form. During those trying times, you'll need a trusted friend by your side, someone who will not just provide moral support but will help you out financially as well.

mPokket is one of the best instant loan apps in India when you need some quick credit. You can easily obtain an instant student loan or salaried loan. Simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and loans for salaried are both credited straight to your bank account within 10 minutes.

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As we've discussed in our 6 things to keep in mind for achieving financial freedom blog, one of the best ways to achieve financial freedom is by limiting your spending. Today, we'll be probing deeper into ways in which you can do that.

When you call your plumber to plug a leak, he first has to isolate the primary cause of the leak. Once that's done, he then has to analyze the situation and come up with the best plan to fix it. Finally, he has to execute that plan properly, or else the customer won't be satisfied and he won't get his money.

Similarly, you first need to find out what causes you to guzzle money away, then make a plan to address it, and finally, stick to that plan and avoid any pitfalls along the way which could put you back to square one. That's what we'll be talking about in this feature.

Fix a Budget for Yourself

Unless you have your monthly cash outflow planned on the basis of your inflow, you won't know when you're spending too much. That's why it's important that you budget your money.

Begin by adding up all your sources of income. That includes, apart from your salary, interest from savings and other miscellaneous sources. Then factor in your fixed payments such as loans, bills and groceries and assign money values to each item of spending by taking an average of how much you spend on each item over the course of a few months.

The difference between your income and your calculated expenditures should provide a pretty good idea of where you stand - whether you're biting off more than you can chew or are within safe limits.

Short-Term Financial Goal Setting

One of the best ways to go about enforcing your budget is by setting short-term goals around the restrictions you've decided to place on your spending.

Make sure these short-term goals are quantifiable. For example, if you find you're spending too much on eating out every month, say around Rs. 5000. Make a goal of not spending over, say, Rs. 2000 for the same, and live by it. Similarly, if you're riding your motorbike to work and spending Rs. 1000 per month on fuel costs, cut that down to say, Rs. 250 by setting a fixed number of days in the month where you use public transport to commute instead.

Without these short-term goals, you'll struggle to track spending and your well-planned budget could go for a toss.

Cash, Not Credit!

Credit cards are convenient, there's no doubt about that. However, that very convenience is the reason behind people's tendency to overspend. After all, when you're using a credit card, you're spending money you don't actually have on you at that moment. Without thinking too much of how it'll impact us by the month's end, we tend to hand over our credit card for a swipe too frequently sometimes.

However, when we make cash payments, we physically take a bite out of an allocation that we can see for ourselves when we put away our purse or wallet.

If you're trying to stick to a budget and have set spending limits for yourself, then cut down on credit or even debit card usage and instead assign fixed amounts of cash only towards those purposes and carry that around with you.

Is Your Environment Tempting You to Overspend?

There are certain settings where we're more inclined to spend more than others. Say, you pass through a road on your way to work that's dotted with attractive shops, where you can't help but walk in every other day to check out the many temptations on offer and eventually end up buying one of them. Or say, you work at a mall, and everywhere you turn, there are ways to blow money away.

It applies to the virtual world too. Many of us while away hours on online shopping platforms like Amazon and Flipkart, salivating at the countless enticing deals on offer. And with fast, convenient online payment modes available at the tap of a finger today, we often end up impulse-buying things we don't really need to, with a quick payment.

So, take a different road if you need to, delete some of the most addictive shopping apps from your phone, at least temporarily, and try your best to discipline yourself when it comes to your spending habits.

Convince Your Friend Circle to Save Too

We all love our circle of closest friends and enjoy a lot of activities together. However, when you find that those group activities tend to take an expensive turn more often than not, it's time to make some changes.

You don't really want to say no and be left out, but at the same time, suggest cheaper ways to hang out once in a while. Perhaps have a fun, group cook-out at home instead of everyone going to a ritzy restaurant. Or suggest travelling by bus or train instead of hailing a cab.

Take a Hard Look at your Lifestyle

Just as people are told to “tighten their belts” during wartime rationing, we have to be flexible with our lifestyle based on our circumstances.

Assess your current financial situation and take a call on whether the lifestyle you're accustomed to right now fits that situation. Perhaps you were raised in a life of considerable luxury but now, on your own, you're stretching your finances to keep living that way.

On the flip side, if you find you're living well within your means, then don't use that as an excuse to increase your spending. If you're happy and satisfied with your current lifestyle and it's letting you save more money for your future, then why change?

At mPokket, our purpose is to provide financial independence to youth. With world-class technology, transparent communication and quick decision-making, we enable today's youth to attain financial independence.

If you are seeking an instant student loan or salaried loan and wondering where to turn for some quick credit, simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and loans for salaried are both credited straight to your bank account within 10 minutes.

The world is getting more and more digitized by the day. Everything from banking to shopping is increasingly relying on the flawless functioning of virtual cogs and gears.

Consequently, this move to digitization has invited its own set of pitfalls, such as identity theft, which is when someone uses another person's personal identifying information (name, ID number, or credit card number) without their permission and with an intent to commit fraud or other crimes.

Understandably then, it's certainly a valid area of concern if you happen to own a credit card, as in the event of a breach, a fraudster could easily open your credit file and make purchases in your name, leaving you in heavy debt in your credit reports. Some could even go as far as opening loans in your name, which will then show up in the credit reports.

Thankfully, there are provisions in place to tackle this issue, and they include the ability to 'freeze' or 'lock' your credit reports at India's credit bureaus.

It's true that both credit lock and credit freeze do more or less the same thing, which is to safeguard your credit reports in the event of identity theft by way of a data breach. But there is a difference between the two, which we'll delve into. 

Credit Lock

Think of credit lock as a way to restrict lenders from accessing your credit reports. When a credit lock is applied, it lets you lock and unlock your credit report using your mobile. You can even do it without needing to remember your card's personal identification number (PIN). 

Therefore, If a fraudster tries to open a credit report account using your name, the credit lock will protect you. Note that any of the reputed credit bureaus will assist you in the process of placing a credit lock. You can manage the credit lock through an app, using a user ID and password.

Credit Freeze

Also referred to as a security freeze, a credit freeze is similar to a credit lock, given that they restrict lenders from accessing your credit report without your consent. A credit freeze is more useful in the case that any theft that might have occurred. When you apply for a credit freeze, creditors cannot access your credit reports until you grant permission to all the different credit bureaus in India to unfreeze your reports. Also, unlike credit lock, you have to use a PIN (or a password), for freezing or unfreezing your credit reports at any time.

When to use a credit freeze?

If you feel any of the below scenarios have already transpired, then consider going for a credit freeze:

• You find that your credit reports are exposed.
• You've been subjected to identity theft.
• You experience a data breach.

How to do a credit freeze?

1. Contact the credit bureaus

2. Provide them with your personal information

3. Receive the PIN they send you

4. Use it to freeze or unfreeze your credit card

When to use a credit lock?

A credit lock is a preventive measure, for the most part, so use it as a deterrent in situations such as when you're unable to locate your card or you won't be using it for an extended period.

How to use a credit lock?

Reach out to the credit bureau. You can then manage the credit lock/unlock online or through an app on your smartphone with just a username and password.

What's the difference between credit lock and credit freeze?

To sum up then, here are the key differences between a credit lock and credit freeze:

Credit LockCredit FreezeProtected by username and password.Protected by Personal Identification Number(PIN).Chargeable.Free.Used as a preventive measure to protect a credit file.Used when your personal information is already under threat.Easy to activate or deactivate online or with a smartphone app, using username and password.After mailing your request to credit bureaus, you have to call the bureaus or follow the online procedure and then generate a PIN to freeze or unfreeze your credit report.It's a simple process.It's complex and takes more time and involvement.

It's worth stressing that while a credit card comes with its share of conveniences, it's a responsibility all the same. So it's important that you take precautions and avoid making common credit card mistakes.

Our mPokket instant loans involve a fully online paperless process with the amount transferred straight to your bank account. Also, when you share your personal details with us, we ensure that it never falls into the wrong hands. We employ state-of-the-art technology and online safety standards to ensure that your confidential and sensitive information is always safe.

If you're on the lookout for some quick credit, it's easy to obtain an instant student loan or salaried loan from mPokket. Simply download the mPokket online loan app, register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 50,000! mPokket instant loans for students online and loans for salaried are both credited straight to your bank account within 10 minutes.

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Given the income tax rules prevalent in India, if your annual income is over Rs. 2.5 lakh, you're required to file income tax returns. Regardless of your source of income — whether it be the revenue from your business or your salaried job — it is mandatory.

That said, income from salary and business are taxed according to their respective tax slabs. But it's important for you to know that there are a few income sources that are completely income tax-exempt, no matter the amount.

With that in mind, we take a low at some tax-exempt income sources that students and young professionals are particularly likely to find useful:

Marriage gifts

Wedding gifts that a newlywed couple receives from any immediate family members are exempt from tax. That includes everyone from their parents, siblings, as well as the siblings' spouses and parents' siblings. Also, the exemption applies irrespective of the gift's value.

Marriage gifts exempt from tax include jewellery, cash, vehicles, stocks, electronic items, and artefacts, among others. Even immovable gifts, such as property or land, are tax-exempt under Section 56 of the Income Tax Act, 1961.

Profit share in a partnership firm

From the total income of a firm, the share of profit a partner of the firm receives is exempt from tax in the hands of the partner. This is because the partner's share is derived after accounting for all applicable expenses and income tax. That said, when the partner receives any interest on capital as well as any remuneration received is taxable.

Ancestral property

In most countries, when one passes on and their property and assets get passed down to their legal heirs, the heir has to pay Inheritance Tax on such assets.

However, in India, there exists no concept of levying tax on inheritance. As a matter of fact, Inheritance Tax (also called Estate Tax) was done away with, in 1985.

However, note that the inherited property could be a source of income, such as by way of sale or rent. So you have to declare this income and pay taxes on it.

Provident Fund

In India, provident funds are mandatory for every employee working in any company registered under The Companies Act, 1956. Post-retirement, the respective Provident Fund (PF) money which a person earns is tax-exempt.

Note that the Employee Provident Fund offers you tax-free returns if the EPFO has received an active contribution on your behalf for five-plus years. And even if you change your job during this period, it remains unaffected.

Gratuity

Gratuity is a fund that some employers provide to their employees. It is a kind of gift that is paid as extra, under the following conditions of superannuation (retirement age), resignation, or sudden death, physical loss or health hazard. An employee can claim a rebate on a gratuity of no more than Rs. 30 lakhs.

Educational Scholarship

This one is particularly useful to know if you're a student. As per Section 10 (16) of the Income Tax Act 1961, when you are granted a scholarship to meet your education costs, it is exempt from income tax.

Do note, however, that the income from the scholarship has to go towards meeting your education expenses only.

Income from a foreign government

When an Indian citizen receives remuneration from a foreign government with regards to any sponsored cooperative technical assistance programme, the amount is entirely tax-free.

It's certainly worth knowing about these tax exemptions, especially with the constantly rising costs of living making every little bit you can save here and there, that much more important.

After all, a young professional in the nascent stages of his or her professional career can feel the pinch of a cash crunch every now and then. 

Thanks to the mPokket instant loan app, a dose of quick credit is just a tap away! You can easily obtain an instant student loan or salaried loan from mPokket. Simply download the mPokket online loan app. Register by uploading a handful of documents, and post-approval, borrow instant online loans of up to Rs. 30,000! mPokket instant loans for students onlilne and loans for salaried are both credited straight to your bank account within 10 minutes.