FAQs

LB is a market place for connecting lenders and borrowers – established to benefit both the lenders and borrowers. All the lenders are required to complete their diligence before investing in borrowers

FAQs/Borrowers

FAQs/Lenders

FAQs/ Borrowers

1. Why borrow using loanbaba.com?

loanbaba.com offers a number of benefits to borrowers such as:

Minimal listing charges

Choice to decide the interest rate range

Option to choose EMI payment date, mutually, with the lender

Complete transparent process with no hidden charges and fees

Online process with no need for physical visits to the lenders and offices

Fully secure process of lending

Borrowers with no credit history but a strong profile overall can also apply for loans

2. Who can be a borrower at loanbaba.com?

At loanbaba.com, anyone desirous of a loan, to fulfil any type of monetary requirement, can be a borrower. With the exception of borrowing for illegal or prohibited purposes under Indian law, individuals can borrow for any purpose.
The borrower at loanbaba.com needs to be:

An Indian citizen

Over 25 years of age

Have a minimum annual income of Rs. 3 lakhs

Pan card holder

Aadhar card holder

Should submit all the documents required

Agree to adhere to loanbaba.com’s policies and borrower code of conduct

3. What are the documents required?

The documents required are:

2 passport sized Photographs

PAN Card

Adhaar Card

Voter ID

Passport

Last 3 month’s bank statements

Last month’s mobile bill/ landline bill

Last 3 month’s salary slip or last year’s Business/Personal ITR or Income Declaration

4. What security checks do I have to go through?

Verification* will be done for:

PAN card

Aadhar card

Last 3 months bank account statements

Credit report**

Email

Linkedin account

Facebook account

Residential address

Office address

Court case checks

Criminal case checks

Employment verification

Credit check

*Physical verification is done wherever applicable.
** Please note that we do not provide credit score. We do provide a proprietary score known as the Loanbaba Score.

5. How do I begin borrowing?

To borrow, you need to register by clicking on the ‘Sign-Up’ option. Enter the information required and pay the registration fee of Rs. 1,000/- (currently waived off). You will also need to upload a few documents, which will be verified by us within 24 to 48 hours. Once the verification process is complete, you will be notified of your successful registration and your profile will go live for the loan to be listed.

Apart from the registration fee, both, lenders and borrowers are required to pay Origination fee. Origination fee is to be paid when the peers enter into a successful transaction and the loan is disbursed into the borrowers account. Loanbaba.com’s Peer to Peer platform enables Borrowers to find a Lender and vice versa. We facilitate a Loan transaction between the two and hence we charge a fee for the service rendered. The origination fee is 2% of the loan amount.

6. How much can I borrow?

You can borrow a minimum amount of Rs. 5,000/- and a maximum of Rs. 10,00,000/- at loanbaba.com.

7. What is the maximum and minimum loan tenure at loanbaba.com?

The minimum loan tenure is six months and maximum is 36 months (three years).

8. How do I contact the lenders?

You can contact lenders through email on the loanbaba.com P2P platform. All communication between the peers will happen through us.

9. What will my EMI payment date be?

The EMI payment dates are mutually decided by the borrowers and lenders. Usually, it is within a few days of the borrower receiving his/her salary.

10. What is the interest rate at which I can borrow?

The maximum rate of interest at which the lenders are permitted to lend to borrowers is 36% and the minimum is 10%. Loanbaba.com uses an automated underwriting system to generate a rate of interest at which the borrower can borrow. This is based on the profile details and creditworthiness of the borrower.

11. Do I need to provide references?

Yes, you need to provide one nominee and two references.Of the two references, one has to be, personal and the other professional.

12. How long does it take for my profile to become live and for my loan to be listed?

Post registering, the verification of your profile and documents requires 48-72 hours. Once that is complete and found to be accurate, your profile is made live and the loan is listed for the lenders to bid.

13. How soon can I find a lender?

Once your loan is listed, there is no guarantee about the amount of time it will require for the lenders to bid for your loan. Usually, borrowers with low-risk profiles are funded sooner. Borrowers can also directly connect with lenders who meet their requirement. Multiple lenders can fund you to meet your loan requirements.

14. When is the loan disbursed?

The loan is disbursed into the borrowers account only after the borrower and lender have signed the original loan agreement, the borrower has provided the lender with post dated cheques towards EMI payment and each has paid the Origination Fee to loanbaba.com. The Borrower also has the option to take disbursement after reaching 70% of the amount required.

15. Can my application be declined?

Yes, your application to be a borrower at loanbaba.com can be declined under the following circumstances:

Any of the documents provided by the borrower cannot be verified

If borrower provides fraudulent or unverifiable information

All the necessary documents are not provided

Credit assessment results in a negative report

Any profile that does not invite lenders for over 30 days

If underwriting on the profile is done but borrower cancels the loan application or stops responding to calls and emails for a continuous period of 10 days from date of registration.

If the borrower does not accept lending offers after being listed and going live

If the borrower wants to cancel loan application during the initiation of loan agreement

If the borrower is found to be borrowing for lending

16. Do the loans require collateral?

No, the loans at loanbaba.com P2P platform do not require collateral. Loans are unsecured.

17. What if I delay or miss a payment?

Borrowers are required to give post-dated EMI cheques to the lenders at the time of signing the loan agreement. Only then the loan amount is disbursed to their account. These checks can take up to 2-3 days to process and for the lender to receive the EMI payment. Such delays do not attract penalties to borrowers.

In case a Borrower defaults in paying the EMI on time, there will be penal interest of Rs. 200 per day.

In case of consistent defaulting, loanbaba.com will send a legal notice to the borrower to restart the payments. In absence of any action from the borrower, our collection agency will follow-up with them to collect the missed payment.

18. Which method is used to calculate repayment?

The EMI is calculated using reducing balance EMI method, wherein the EMI remains the same till the end of the tenure. Thus, the rate of interest will be calculated depending upon the outstanding principle amount.

19. Which details in my profile will be available for the lenders to view?

Lenders need to make an informed decision as they will be lending borrowers their money. The information they can see on a borrower’s profile are mentioned below. Your address and phone number will not be made available to anyone. Lenders will be able to connect with you only via email.
Borrower’s name
Profession
Reason for applying for loan
Important Financial Details*

* Loanbaba.com ensures the Borrowers listed on the portal are thoroughly scrutinized. It is mandatory for the borrower to submit the IT Returns, Bank statements, and Salary Slips Credit Report is generated by us. We analyse the financial standing of the borrower and publish the report, which is visible to the Lender. A full Bank statement will not be visible to the Lender, but the summary and significant details will be visible.

20. What are the fees and charges?

All borrowers need to pay a fee of Rs. 1,000/- at the time of registration (currently waived off). This is required for verification and administrative purposes. Apart from the registration fee, both, lenders and borrowers are required to pay Origination fee. Origination fee is to be paid when the peers enter into a successful transaction and the loan is disbursed into the borrowers account. The origination fee is the 2% of the loan amount. Loanbaba.com has a completely transparent process and involves no other hidden charges.

21. Is it possible to change the loan amount I want to borrow after applying for a loan?

No, borrowers cannot change the loan amount. They do have the option to 'Top-Up' the loan.

22. Can I cancel my loan application and at what stage?

You can delete your profile as a borrower at loanbaba.com anytime, without being refunded. However, you cannot cancel a loan application once the agreement has been signed.

23. What do I do if I want to change my bank details or set-up direct debit?

Lenders and borrowers have to mutually decide about changing bank details and setting up direct debit. Loanbaba.com is just a facilitator and has no say in the matter. However, all the communication needs to happen through loanbaba.com’s P2P platform.

24. Can a borrower also be a lender?

No, a borrower cannot be a lender. In case a borrower is found to be borrowing for lending, their profile will be terminated.

25. Why borrow from loanbaba.com P2P portal?

You don’t need to pay service charges to intermediaries like banks and NBFCs.

Decide the interest rate by directly interacting with the lender

Borrowers get to choose from different lenders

Since lenders will choose borrowers and vice versa, the traditional position of borrowers is replaced with the one wherein they have more choice

Complete transparent process with no hidden charges and fees

Online process with no need for physical visits to the lenders and offices

Fully secure process of lending

Borrowers with low credit score and no credit history can also apply for loans

No prepayment fee

Borrowers and lenders, mutually, decide the EMI payment date

FAQs/ Lenders

1. Who can lend on loanbaba.com P2P portal?

Any individual meeting the following criteria can lend at loanbaba.com:

An individual lender and not an organisational entity

An Indian citizen

Over 25 years of age

With annual income of over Rs. 6 lakhs

Pan card holder

Valid bank accounts in India

Should have invested in fixed deposits, stocks, or other investments using trading or DEMAT account

Interest income less than 30%

Should lend from their surplus income and not borrow for the same

Agrees to adhere to loanbaba.com’s policies, terms, conditions and lender code of conduct

Loanbaba.com is the facilitator for those who wish to earn high returns. We vet the borrower thoroughly and depending on the creditworthiness of the borrower

2. What security checks do I have to go through?

loanbaba.com does verification for:

PAN card

Aadhar card

Last 3 months bank account statements

Credit report

Email verification

Linkedin account

Facebook account

Residential address

Office address

Court case checks

Criminal case checks

Employment verification

Credit check

3. How do I register as a lender at loanbaba.com P2P portal?

To register, click on the ‘Sign-Up’ option. Enter the information required and pay the registration fee of Rs. 500/- (currently waived off). You will also need to upload few documents, which will be verified by us in 24 to 48 hours. Once the verification process is complete, you will be notified of your successful registration and you can begin lending.

4. How will I know my borrowers? What details about them will be made available to me?

All the verified borrowers are listed on the loanbaba.com P2P portal. You will be able to access all active borrowers by clicking on ‘Browse Borrowers’ on your dashboard. All the details about the borrower – KYC details, educational, professional and financial information along with credit scores – will be available for you to see, except for their address and phone number. This way you can make an informed decision. You also have an option to contact the borrower via the Chat option displayed on your dashboard.

5. How much money can I lend? And for how long (tenure)?

Lenders have to lend a minimum of Rs. 5,000/- and a maximum of Rs. 10,00,000 /- (10 lakhs) to the listed and verified borrowers. They can lend for a minimum of six and a maximum of 36 months (3 years).

Though there is no limit to the amount of money you can lend to a single borrower, it is necessary that lenders lend a minimum of 20% of the proposed amount. It is advisable to lend to multiple borrowers to reduce the risk.

Lenders are, also, required to declare the amount they are willing to lend and the amount that is available after they have lent to other borrowers. Lenders do not have to transfer the money to any of loanbaba.com’s account. This is a P2P platform, which is simply a facilitator for the peers.

The loan amount needs to be disbursed from the lenders account, directly, into the borrowers account soon after both sign the loan agreement and the borrower provides the PDCs (post dated cheques) for repayment.

6. Why should I pay registration and origination fee to lend my own money?

A registration fee of Rs. 500/- is mandatory for both, lenders and borrowers (currently waived off). It is used for administration related work - verification and processing of the documents.

Apart from the registration fee, both, lenders and borrowers are required to pay Origination fee. Origination fee is to be paid when the peers enter into a successful transaction and the loan is disbursed into the borrowers account. Loanbaba.com’s Peer to Peer platform enables Borrowers to find a Lender and vice versa. We facilitate a Loan transaction between the two and hence we charge a fee for the service rendered. The origination fee is the 1% of the loan amount.

Loanbaba.com has a completely transparent process and involves no other hidden charges.

7. Why does loanbaba.com verify my details?

loanbaba.com has a very strict policy regarding security checks. We aim to provide everyone full guarantee about who they are dealing with. Verification of the peer’s background also increases authentic transactions and ensures that this P2P platform is not misused. It also guarantees that all lenders and borrowers are operating within the statutory laws of India.

8. What kind of returns can I get when I lend at loanbaba.com’s portal?

Your average return is based on the Interest Rate you are earning from Individual Borrowers. Interest Rate varies between 10% & 12%. We do the credit underwriting for you and also recommend an Interest rate for a particular borrower. The interest that you charge can be higher or lower than the recommended one, on which your average return will depend. As with any type of investment, always spread your risk over multiple options. We recommend you to Lend to multiple borrowers and spread & minimize the risk and earn a steady return.

9. Is there any guarantee on the lending?

The borrowers at loanbaba.com P2P platform go through extensive security checks. Details about their educational, professional and financial background along with credit risk status are available on their profile for the lenders benefit. However, even with all this information, there is some risk involved as loanbaba.com cannot guarantee zero defaults or high returns. However, lenders can seek legal help. It is advisable to read the terms and conditions thoroughly before lending. Our customer service executives are also available at all times to guide you and resolve your queries.

10. How will the repayment be calculated? What if the borrower defaults?

The EMI is calculated using the reducing balance method. The date on which the EMI is to be paid is mutually decided by the lenders and borrowers. Usually, it is the date on which the borrowers receive their salary/ get paid. Borrowers are required to give post-dated EMI cheques to the lenders at the time of signing the loan agreement. Only then the loan amount is disbursed to their account. These cheques can take up to 2-3 days to process and for the lender to receive the EMI payment. Such delays do not attract penalties to borrowers.
In case a Borrower defaults in paying the EMI on time, there will be penal interest of Rs. 100 per day.

11. How will loanbaba.com help me if the borrower consistently defaults or stops paying?

We understand that there are risks involved even when all the borrower profiles are verified and lender safety policies are in place. In case of consistent defaulting, loanbaba.com will send a legal notice to the borrower to restart the payments. In absence of any action from the borrower, our collection agency will follow-up with them to collect the missed payment. To avoid risks, lenders are advised to lend to a number of borrowers.

12. Is my interest income through loanbaba taxable?

Yes, your interest income through loanbabaP2P portal is taxable. We will provide you with your annual income statement, available in an e-format. Lenders are responsible to pay the tax. Any default on the tax payment by the lender is not loanbaba.com’s responsibility.

13. Why lend using loanbaba.com’s P2P portal?

You don’t need to pay service charges to intermediaries like banks and NBFCs.

Get better rates of interest and earn high interest income without incurring additional costs

Decide the interest rate by directly contacting the borrower

Choose whom to lend to by assessing borrower profiles

Every borrower goes through thorough credit assessment

Complete transparent process with no hidden charges and fees

Online process with no need for physical visits to the lenders and offices

Fully secure process of lending

Sign Up and Register Now to earn better returns, Borrow at lower rates! Register Now