Need money instantly? These loans can help

A short-term loan can help tackle a sudden financial emergency. But how easy is it to get one? Here are 5 types of quick short-term loans that you can consider in a pinch.

Need money instantly? These loans can help

A financial emergency can strike at any time, and you might suddenly be in need of funds. You turn to your savings and realise it won’t be enough. A loan is the only alternative, but do you have the time to wait while it gets approved?

This is where a short-term loan can come in handy. It’s like a personal loan, only instant and for a shorter duration. This makes it easier to deal with a financial emergency. Depending on what your requirement is, there are various types of short-term loans offered by banks and other financial institutions.

1. Payday loan

This is a short-term loan with a small tenure but with higher interest rates than a personal loan. However, its advantage is that you can get this loan instantly. Payday lenders like creditbazaar, loanbaba, Rupeelend, etc., provide funds in India. You can also borrow smaller amounts than a personal loan usually allows. Simply upload your basic personal details on these platforms like salary slip, bank details, and PAN card copy online, and you can have the loan amount credited directly into your bank account on the same day. Some of these loans can be taken for a few days (which is perfect to tide you over till your salary comes in) or a few months. A personal loan, on the other hand, typically has a tenure of 1-5 years.

Related: Types of personal loans you must know about

2. Loan from an employer

Many companies are willing to give a short-term loan to their employees at either low interest or no interest at all. Instead of having you pay it back, it usually gets adjusted against your salary every month. Do understand all terms and conditions – and the tax considerations – before you seek a loan from your employer.

Related: Did you know you can avail a loan against your insurance policy?

3. Loan against credit card

If you use a credit card, you can avail of an instant loan against it. A credit card loan is typically pre-approved or pre-qualified. Your credit card company will evaluate your credit history, repayment capacity, and existing credit limit to determine the amount of loan you are eligible for. You can expect to get a higher amount than the cash withdrawal limit of your card. A loan against your credit card normally comes at the same interest rate as a personal loan, and you can opt for a repayment period anywhere between 3 months and 24 months.

4. Loan against mutual fund

Check with your bank to see if you can get a loan by pledging your mutual fund units. This short-term loan can be taken against debt funds as well as equity-oriented funds. The advantage of pledging mutual funds is that even if you don’t have any credit history, you can still get this bank overdraft instantly. While most short-term loans are unsecured, this product is secured and yet requires very little processing time.

Related: Ever heard of loans that help you save money? 

5. Loan against PPF

If you have a public provident fund (PPF) account that you have contributed to regularly, you are eligible to take a loan from the 3rd financial year to the 6th financial year of opening the account. While a loan against a PPF account is charged 2% higher than the interest you earn on the balance, the loan itself comes at a lower interest rate than a personal loan. You must repay the loan within 36 months or else the interest rate goes up by 6%. The maximum amount you are eligible for is 25% of the balance in your account at the end of the second financial year prior to the year in which you apply for the loan.

6. Gold Loan

Gold loan allows you to pledge your gold ornaments or jewellery for immediate procurement of funds. Once the ornaments are verified, the loan amount is sanctioned immediately. Gold loans are usually taken for a shorter period like paying for a child’s education, funding a wedding, paying for medical emergency, etc. 
In India, there are many nationalised banks, private banks, public sector banks and other non-banking finance organisations which provide loans against gold at attractive rates. You can expect to get a loan amount which could be as high as up to 80% of the market value of the gold. The interest rate of gold loan can be availed of at a comparatively lower interest rate than personal loan ranging between 12% and16%. 


Irrespective of which loan vehicle you choose, apply only if you need money urgently and if you are sure you can repay the loan within the scheduled repayment period. Taking a loan to cater to not-so-urgent needs can boomerang and impinge on your other financial goals.

All said and done, while there are many loan options available in the market, it is always better to put aside a little every month and build a contingency fund for unplanned emergencies.


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