Leading Banks in both public and private sectors cash on the festive season by offering loans at cheaper or discounted rate. There is a surge in consumer spending during festivals. Banks attract more customers by offering lower rates of interest. Festival loans are however, a variant of personal loans. It is extremely convenient for people who want a small loan, can repay early but do not want to pay interest at the exorbitant rates levied by most banks

Festival loans are given for amounts as low as Rs 5,000 and the maximum amount is limited to Rs 50,000. Festival loans are generally restricted to 12 months. Repayment can be done by Equated Monthly Installments or EMI. The loan size is smaller and the repayment period is shorter than that for personal loans.

Rates of interest charged will be as per Bank's policy on the date of disbursement of loan. Rate of Interest is discounted during the festive season. Thus it is lower than the normal days.

Borrowers can fill a form at the bank and apply for the loan. The processing fee is also lower than personal and other loans. Banks generally charge Rs.100 as processing fee irrespective of the quantum of loan

Documents Required for Festival Loans:

• Passport size photograph.
• Residence Proof.
• Salary Certificate / Slip from employer.
• Form No.16 (Latest).
• Form No.135 of the bank, duly filed in by borrower and guarantor
• Application forms meant for personal loans ( festival loans )

• Passport size photograph.
• Proof of official / Business address, which may include establishment certificate telephone bill etc.
• IT returns & financial statement for the last two financial years.
• Copy of registration / License / Govt. approval required to pursue the profession, if any.
• Proof of qualification (Certificate issued by the Concern University / Collage / Institute, Dept as the case may be).